Railways Bill (Eighth sitting)

The Committee consisted of the following Members:

Chairs: Paula Barker, † Wera Hobhouse, Sir Alec Shelbrooke, Matt Western

† Argar, Edward (Melton and Syston) (Con)

† Caliskan, Nesil (Comptroller of His Majesty's Household)

Conlon, Liam (Beckenham and Penge) (Lab)

† Francis, Daniel (Bexleyheath and Crayford) (Lab)

† Glover, Olly (Didcot and Wantage) (LD)

† Greenwood, Lilian (Parliamentary Under-Secretary of State for Transport)

Hatton, Lloyd (South Dorset) (Lab)

† Kirkham, Jayne (Truro and Falmouth) (Lab/Co-op)

† Mather, Keir (Parliamentary Under-Secretary of State for Transport)

† Mayhew, Jerome (Broadland and Fakenham) (Con)

† Morello, Edward (West Dorset) (LD)

† Ranger, Andrew (Wrexham) (Lab)

† Robertson, Joe (Isle of Wight East) (Con)

† Shanker, Baggy (Derby South) (Lab/Co-op)

Smith, Rebecca (South West Devon) (Con)

† Smith, Sarah (Hyndburn) (Lab)

† Turner, Laurence (Birmingham Northfield) (Lab)

Rob Cope, Francis Morse, Dominic Stockbridge, Claire Cozens, Committee Clerks

† attended the Committee

Public Bill Committee

[Wera Hobhouse in the Chair]

Railways Bill

Clause 17

Rail freight target

I beg to move amendment 262, in clause 17, page 9, line 24, at end insert—

“(1A) Any proposals by the Secretary of State and Great British Rail about how they intend to meet the target under section must include an assessment of the impact of those proposals on level crossings.”

With this it will be convenient to discuss the following:

Amendment 219, in clause 17, page 9, line 30, leave out “have regard to” and insert “take into account in all relevant decisions and demonstrate that it has taken into account”.

Amendment 252, in clause 17, page 9, line 30, leave out “have” and insert

“as far as possible have due”.

Amendment 149, in clause 17, page 9, line 34, at end insert—

“(5) The Secretary of State must publish a national freight strategy.

(6) A strategy as set out in subsection (5) must make provision for the electrification of freight routes and infrastructure improvements to support increased freight capacity and utilisation.”

Amendment 220, in clause 17, page 9, line 34, at end insert —

“(5) The Secretary of State must take into account the rail freight target in all relevant decisions and demonstrate how the target has been taken into account.”

Amendment 250, in clause 18, page 9, line 34, at end insert—

“(5) Any target set under this section must provide that the proportion of goods carried by rail relative to any other form of transport increases at a rate higher than the rate of projected economic growth for the same period as is covered by that target.

(6) For the purposes of this section, the ‘rate of projected economic growth’ has such meaning as the Secretary of State may specify.”

Clause stand part.

New clause 47—Rail freight target: Annual report on rail freight—

“(1) Within 12 months of the passing of this Act, and every 12 months thereafter, Great British Railways must prepare and publish an annual report setting out—

(a) the steps it has taken to have regard to the rail freight target set under section 17;

(b) its performance in facilitating the carriage of goods by rail;

(c) any measures taken to protect and improve access for freight services;

(d) progress on enhancing the capacity and reliability of strategic freight corridors.

(2) The Secretary of State must lay a copy of the report before Parliament and provide the report to the Office of Rail and Road.

(3) The Office of Rail and Road must publish an assessment of the report within six months of its publication.”

It is good to see you back in your place, Mrs Hobhouse. Something happened during our short recess: I was in the Tea Room, at the right end, but down at the wrong end I heard someone singing “Happy Birthday”. It occurred to me that today is the Minister’s birthday. [Hon. Members: “Hear! Hear!”] We are not going to sing, but I think we should all take the opportunity to say happy birthday to the Minister. What better activity could one choose for their birthday than for all of us to be together, like one big happy family?

I know that the icing on the cake will be clause 17, which requires the Secretary of State to set a target to increase freight on the railways. The Government tell us that this should be a measurable target that establishes the goal, as an amount or percentage, for how much growth is sought—although that is not specified in the Bill, like so much else. Great British Railways must have regard to the target when carrying out its statutory functions, and it should also have regard to any freight growth target or strategy set by Scottish Ministers.

This appears to be good news for the rail freight sector, and it will be a relief for it that it has been mentioned in the Bill—I believe that this is a relatively late inclusion. However, the duty is merely for GBR to “have regard” to the freight target, and we have explored such wording in the debates on other clauses. It requires that GBR only considers the target, not delivers it, which undermines its effectiveness as a statutory growth driver. The Rail Freight Group, in its written evidence to the Transport Committee, set out:

“To succeed and grow rail freight customers and operators will need to be assured that…a. they can secure access to the network in a fair, consistent and timely way for their services, including those on new routes and to new destinations as they arise…b. that the costs of rail remain competitive when compared to road freight…c. that the network remains reliable and fit for purpose for freight trains (for example, to handle heavy or high gauge container trains)…d. that there is independent oversight and a right of appeal if freight is unfairly treated or disadvantaged…e. That they can invest in rail freight assets (wagons, terminals, locomotives etc) with the confidence that they will have a long term use of those assets.”

It went on to say:

“The current provisions in the Bill provide some positive elements in support of these requirements, but also increase the risk in others. Overall, the Bill is not sufficient to assure rail freight of the key points ahead as currently presented.”

The main takeaway from the Rail Freight Group is that it does not feel that the target can be met, however well-intentioned it might be, if the Bill’s current wording remains.

Rail Forum, in its written evidence to the Transport Committee, said:

“From Rail Forum’s perspective there is nothing specific in the Bill that will guarantee improved travel for passengers. Improvement is predicated on the goodwill of GBR and others driving things in the ‘right direction’. In our view the key to improvement is culture change within those organisations coming together to form GBR. Creating GBR from Network Rail Infrastructure Ltd (NRIL) will not signal the need for change and creates a risk that the current Network Rail culture will be seen as the norm and hence the status quo will prevail.”

We have discussed this a bit. The Minister has taken the view that this cultural change does not exist. If he continues with that belief, he will condemn this nationalisation experiment to almost certain failure. The vast majority of the wider sector agrees that organisational culture is the single most important ingredient for the Bill to get right, yet time and again the Government have resisted amendments suggested by the Opposition and the Liberal Democrats to drive an improvement in culture and focus on the right things. Having set the target for GBR, the clause uses very weak language for what comes next: just “have regard to”. It is too weak.

Amendment 262, in the name of my hon. Friend the Member for Runnymede and Weybridge (Dr Spencer), who is not a member of the Committee but drafted this amendment along with a couple of others that we have already debated, seeks to highlight his constituents’ concerns about the negative impact that level crossings can have on communities. He is right to stand up for his constituents and that freight is one more part of the jigsaw when we look at the juxtaposition between the needs of the railway—whether it is passenger services or, as in the case of this amendment, rail freight—and the knock-on consequences for the wider economy of a community whose economic and social heart is bisected by a level crossing. He is right that those three sometimes competing issues need to be balanced, which is the intention of amendment 262.

Amendment 219 in my name would leave out “have regard to” and insert

“take into account in all relevant decisions and demonstrate that it has taken into account”.

That is a stronger line to take and makes it easier for freight organisations to hold decision makers to account. They need to have the power to challenge the historic approach of freight being secondary to passenger travel. Accommodation is needed for both in a sector where we all hope that both passenger and freight will grow, but we need to recognise that it is a capacity-limited structure and that there will therefore have to be some compromise. Historically, freight has always played second fiddle to passenger travel. We need accommodation for both, and the new wording would strengthen the hand of freight to ensure that its proper position is maintained by GBR. I will seek to divide the Committee on that amendment if the opportunity arises.

Amendment 149, in the name of the hon. Member for Didcot and Wantage, would require a national freight strategy, including electrification of freight routes and infrastructure improvements. It is unobjectionable, and in fact quite good. I would support it should the hon. Member press it to a vote.

Amendment 220, which is in my name, would strengthen the accountability of the Secretary of State by adding a new subsection that states:

“The Secretary of State must take into account the rail freight target in all relevant decisions and”—

importantly—

“demonstrate how the target has been taken into account.”

The key word there, of course, is “demonstrate”. It would keep the duty high in the mind of officials and make it easier for independent rail freight operators to hold the Government to their duty. Without that strengthening, the clause would achieve very little. We go through the whole process of having this rail freight target—“Isn’t that wonderful? We’ve done a great job. We as policymakers think this is excellent”—and then the delivery organisation just has to “have regard” to it and can leave it on the shelf. As currently drafted, it looks as though the clause is a last-minute bung to the loud rail freight sector.

We all heard the oral evidence from Maggie Simpson of the Rail Freight Group. She is, without doubt, the doughtiest of campaigners on behalf of the members of her organisation. She is very effective, but it was clear to me that clause 17 was a late accommodation for her advocacy, but it is only half cocked. That explains why, while Maggie Simpson was trying not to sound too churlish in relation to what the Government have done so far, she nevertheless went on to say it is still deserving of criticism. This amendment seeks to improve further what the Government have started.

In relation to the rail freight target, new clause 47 requires an annual report on rail freight. It would create

“an annual reporting and oversight mechanism, requiring GBR to set out how freight access, performance and corridor capacity are being supported, and requiring the ORR to publish an independent assessment”.

That would strengthen the clause, which the Rail Freight Group says does not go far enough—I have already set out its quote in relation to that.

Once more, we are back to the accountability of a new nationalised industry. You get what you measure, and without requirements for GBR to report, there is a serious risk of getting lost in the weeds. The decision to nationalise is the Government’s; it is a political decision based on their ideology, but we have to accept that it does remove market forces. Some people say there are negative elements of market forces, but there are undoubtedly positive elements as well; we just need to be open-eyed about it. If we remove market forces as a driver of competition, efficiency and innovation, then they need to be replaced by duties in the legislation or accompanying documents. The duty to replace the incentives with cumbersome regulations and control is an inevitable consequence of the decision to nationalise. That is what new clause 47 is intended to achieve.

It is a pleasure to serve under your chairship once again, Mrs Hobhouse.

Liberal Democrat amendment 252 is intended to strengthen the freight target in the Bill, which—as I have previously said—is something that we welcome. Amendment 149 on freight electrification and the need for a freight strategy highlights the fact that freight is neglected on our network. The percentage of freight that moves by rail is much lower than in comparable western and central European countries, therefore there needs to be additional thought as to how that is going to be changed. The strategy should be a step towards how the Government intend to achieve their eventual freight target. We support Conservative amendments 219 and 220 as they are similar in spirit.

We are not quite so persuaded by the Conservatives’ new clause 47. One of the recurring debates we are having on this Committee is the balance between accountability in the form of annual reports and making sure that GBR is not drowned by the demand for them. That is our reservation about new clause 47.

It is a pleasure to once again serve under your chairship, Mrs Hobhouse. Before I begin my remarks, may I seek a piece of advice on amendment 250? We are considering it as part of this group, but if it has not been moved and has been proposed by a Member who is not on the Committee, am I required to speak to it?

You can speak to it, but we will not put the Question for Division.

Thank you, Mrs Hobhouse. I thank all hon. Members for their amendments, which seek to make changes to the provisions on the rail freight growth target. I also thank the shadow Minister for his very warm birthday wishes. I agree with the sentiment that he expressed: what more of a gift could I have received than working through the amendments in this group?

Amendment 262 seeks to require the Secretary of State to produce an assessment of how targets to increase freight on the rail network could impact level crossings. As I said in a debate on a previous group of amendments, effective consultation, robust evidence gathering and meaningful engagement with communities and local authorities will ensure that any future decisions on rail operations—passenger or freight—are well informed and responsive to local needs and those of the railway more broadly. GBR will continue to manage level crossings in a way that maintains high levels of safety for all users, as enforced by the ORR, that reflects local and national priorities, and that is firmly grounded in evidence at a local level.

Amendments 252 and 219 would both require the freight growth target to play a larger role in GBR’s decision making. The Bill already requires GBR to take the target into account when making relevant decisions. The amendments would not alter that, and could be seen as weakening the obligation. I agree that GBR needs to be held accountable against the growth target if it falls short of our expectations. To that end, we will expect GBR to set out a credible pathway in its business plan for meeting its freight growth targets. If GBR fails to meet those targets, we expect it to explain why, and in extremis, both the ORR and the Secretary of State can take action to ensure that its behaviour improves. Therefore, though I share the intent of the hon. Members for Didcot and Wantage and for Broadland and Fakenham, amendments 252 and 219 are not substantively different from what is already set out in the Bill, and the existing accountability procedures are sufficiently robust.

Similarly, amendment 220 seeks to have the same effect, but on the Secretary of State, by requiring that they take the growth target into account on all relevant decisions. The Bill requires the Secretary of State to set the rail freight growth target and to publish it; the target is also supported by the duty to promote rail freight in clause 18. That duty will apply to decisions by both the Secretary of State and GBR when exercising their functions relating to railways and rail services. Therefore, although I appreciate the intent of the hon. Member for Broadland and Fakenham, the amendment is unnecessary, as protections for rail freight are already enshrined in the Bill.

Amendment 149 requires the Secretary of State to publish a national freight strategy. This Government appreciate the importance of long-term certainty, clarity and confidence for freight operators and investors. That is why, alongside the freight growth target, the Secretary of State will be required to issue a long-term rail strategy. The strategy will set out the Secretary of State’s vision for the railways and will further reinforce the Government’s commitment to the freight growth target. The strategy makes the proposal to publish a similar document, tabled by the hon. Member for Didcot and Wantage, redundant.

New clause 47 would require GBR to publish an annual report setting out how it has had regard to the growth target. We will expect GBR to set out a clear and credible pathway for how it will meet the freight growth targets in its business planning. If GBR failed to meet these targets, we would expect it to clearly set out why. There will also be a representative on GBR’s board with responsibility for freight, embedding our ambition to grow the sector at the top of the organisation. The ORR, which will be subject to the duty to promote rail freight, will have an enhanced monitoring function that will enable it to provide independent advice to the Secretary of State on GBR’s delivery against its approved business plan. This Government have already set clear accountability mechanisms in place to safeguard our ambition to grow the freight sector.

Finally, as we have already discussed, the freight target will support the growth of freight and the associated environmental and resilience benefits. I urge the hon. Members for Didcot and Wantage and for Broadland and Fakenham not to press their amendments, and I commend the clause to the Committee.

The Minister will not be wholly surprised that I do not agree with his analysis. I intend to press amendments 219 and 220—and, in the fullness of time, new clause 47—to a Division, but I beg to ask leave to withdraw amendment 262.

Amendment proposed: 219, in clause 17, page 9, line 30, leave out “have regard to” and insert

“take into account in all relevant decisions and demonstrate that it has taken into account”.—(Jerome Mayhew.)

Question put, That the amendment be made.

37|0|4|9|The Committee divided:|Question accordingly negatived.||0|0

Amendment proposed: 220, in clause 17, page 9, line 34, at end insert —

“(5) The Secretary of State must take into account the rail freight target in all relevant decisions and demonstrate how the target has been taken into account.”—(Jerome Mayhew.)

Question put, That the amendment be made.

38|0|4|9|The Committee divided:|Question accordingly negatived.||0|0

Clause 18

General duties of Ministers, Great British Railways and ORR

I beg to move amendment 34, in clause 18, page 10, line 12, leave out “They” and insert

“Each person or organisation designated under section 18(1)”.

With this it will be convenient to discuss clause stand part.

This is one of the more important clauses, so I look forward to discussing it with the Committee. It sets out the general duties of Ministers, GBR and the Office of Rail and Road. In other words, it sets out the things they must seek to achieve when carrying out their functions. GBR will have freedom to consider which duties are relevant and what weight to place on each duty, but should be able to demonstrate how it has had regard to its duties. Subsection (1) sets out to whom the general duties apply. In addition to GBR, they apply to the Office of Rail and Road, the Secretary of State, Scottish Ministers and Welsh Ministers when they carry out their railway functions.

There is an exception for the ORR’s safety-related functions and train driver licensing functions. No doubt the Minister will correct me if I am wrong, but I assume that is because when it is exercising its safety functions, the intention is for safety to be the priority and to not be second guessed. The ORR should not have to weigh it against other duties. The Bill does not change the current safety regime and the official Opposition wholeheartedly agree with that position.

There is also an exception for the functions of the Office of Rail and Road under the Competition Act 1998. When the ORR acts as a concurrent competition regulator with the Competition and Markets Authority, as we previously discussed, both bodies should be applying the same duties, otherwise there really would be confusion.

I am going to go through the clause in some detail. It will take some time, but it is an important part of our consideration. The duties listed in subsection (2) require GBR and the sector bodies to consider the following.

Subsection (2)(a) provides that they must

“promote the interests of users and potential users of the railway”—

that is passengers and potential passengers—including the needs of disabled people.

Subsection (2)(b) provides that they must promote the use of rail freight. This duty, combined with the rail freight target in clause 17, recognises the importance of freight to the economy and the environment.

Subsection (2)(c) provides that they must promote “high standards” in railway performance. Subsection (3) then defines “performance” as meaning

“(a) reliability (including punctuality), and

(b) the avoidance or mitigation of passenger overcrowding.”

That definition is wholly inadequate, as we have discussed at some length on previous days.

Subsection (2)(d) provides that they must ensure that railway service providers, such as GBR, devolved operators, freight operators and open access operators can plan, invest and make decisions about their own business. We will come on to consider that point in more detail.

Subsection (2)(e) provides that they must run the railway “in the public interest”—so far, so good—which is defined in subsection (3) as including social, economic and environmental interests.

Subsection (2)(f) requires them to make efficient use of public funds—that is, to carefully manage the amount of public subsidy required to run the railway.

Taken together, the functions in clause 3, which are what GBR must do, and these duties, which are what GBR must think about, demonstrate GBR’s purpose—those are my words. We have put that together into a purpose clause, which I look forward to voting for when we consider the new clauses.

The functions under clause 18(2) contain nothing about growing passenger numbers, increasing private sector investment in the network or encouraging open access. Apart from scattered references elsewhere to discounting schemes or the passengers’ council, clause 18(2)(a) is effectively the only substantive accessibility duty in the Bill. It reads as a bit of a bolt-on, rather than a clear, integrated obligation.

Subsection (2)(d) is meant to provide certainty for operators, but in practice it offers little reassurance to manufacturers or the wider supply chain. Without statutory planning cycles, which we have discussed, procurement obligations or long-term fleet strategies, which, again, we have discussed, the duty is too vague to give industry the confidence needed for investment.

How can GBR be confident in achieving the purposes of clause 18(2)(d) given the ability of the Secretary of State to direct at whim, issue guidance, set the rail strategy and so on? For business, it would be impossible to know when a decision has been taken, since each one can be second-guessed by the Department for Transport. Businesses cannot even take for granted the funding allocations in the control period either, because, for the first time in 30 years—I stand to be corrected; we are in CP7, so 30 to 35 years—inter-year control period funding can be changed without notice on the whim of the Secretary of State.

Subsection (3) gives only a narrow definition of “railway service performance”—punctuality, reliability and overcrowding—but omits other core standards such as cancellations, journey time, customer experience, wi-fi, mobile phone connectivity, accessibility, disruption handling and information provision. There are probably a few others as well. This limited list weakens the duty and leaves major aspects of service quality outside the statutory framework. There is no explanation for that. Why are some core elements of the customer experience included in the Bill, establishing the precedent that it is the appropriate place for them to be considered, and then—deliberately, one assumes—are many factors of profound importance to the travelling public and their experience of the railways omitted?

Amendment 34 aims to achieve some housekeeping on the drafting of the Bill. Clause 18(2) does not make it clear which of the three bodies has which responsibilities —it simply refers to “they”. That is a recipe for confusion and potential buck-passing. We have three organisations or groups, each with combined duties under this clause. They are, of course, Great British Railways, the Ministers and the ORR. It is not clear which one, in a given situation, is responsible under the clause.

The duties set out are joint duties. Anyone who has been a student and rented a flat with multiple occupancy knows painfully the difference between liabilities that are joint and several, and ones that are simply joint. I believe that the intention of the drafters was to have clear lines of accountability; if that was not their intention, the Minister needs to make that clear. However, the problem with having joint liability is that one organisation could say that is not their problem, but one for one of the other organisations—GBR, the ORR, or the Minister. As landlords have found many times over to the cost of tenants, the beauty of joint and several liability is that each operation is responsible for all of the duties, and that clarifies where responsibility lies. I look forward to hearing the Minister’s explanation as to why that is not the case in this clause.

It is a pleasure to serve under your chairship, Mrs Hobhouse. I will briefly speak to clause 18 stand part. At the outset, I remind Members that I am the chair of the all-party parliamentary group on wheelchair users, and one of my children is a wheelchair user.

I do not believe that some of these details need to be set out in the Bill. I am a London MP. The details of how Transport for London operates on accessibility issues are not set out in the Greater London Authority Act 1989, yet, in my mind, TfL leads the way, particularly with its TfL Go app, on the accessibility of the information that it provides to disabled passengers. As the Minister and other colleagues know, I constantly say that I would like to see that kind of app being rolled out for Great British Railways. It would be show people which stations were accessible, live information about which lifts were working, and where there were accessible toilets.

For my constituents in Bexley and Crayford, we have a nationalised railway, in the main, through Southeastern, although we also have Thameslink at Slade Green. We already have an exceptional service for disabled passengers. Sometimes, passengers will need to book, but I could give the Committee a list of stations that are staffed constantly and that provide a very good service for disabled passengers. Equally, we continue to see the roll-out of changing places toilets. Toilets are a key issue for many disabled people, including my child, who cannot use a standard toilet. We have seen that roll-out from Southeastern at Margate through what was Network Rail at London Bridge and Waterloo, and very soon we will see it at Charing Cross.

I accept that disabled passengers still have poor experiences on many parts of the network, and we need to improve that. However, as I say, we already have, through Transport for London, an app that leads the way. I had a terrible experience last year in Paris, when there was no live information and a lift was not working. I had to carry my child up a set of escalators, while my wife carried the wheelchair behind us. Information about those kinds of things does not need to be on the face of the Bill, but, as we have already seen with TfL, we can lead on that provision, and I believe that Great British Railways should lead in due course. Those things do not need to be set out in the Bill; we already have examples of them with Southeastern and others, who are providing the facilities here and now.

I will start with the point about accessibility, which the shadow Minister and my hon. Friend the Member for Bexleyheath and Crayford have both spoken about. I reiterate how essential it is that accessibility provisions are hardwired into the Bill. I thank my hon. Friend for raising the work that is already taking place in that space, whether that is delivering the next phase of the passenger assist programme, rolling out welcome points more broadly or widening eligibility for the disabled persons railcard. He is right to say that there is a lot further to go.

We are all responsible, through the creation of GBR, for ensuring that accessibility is wired into the heart of it through its duties and in the functioning of the passenger watchdog—to which we will turn to later in our deliberations. My hon. Friend also makes an important point about accessibility of railway functions through an app. GBR will have a one-stop-shop app where people will be able to book train tickets and passenger assist all in the same place, which will hopefully go some way to addressing the concerns that he has outlined.

The Minister refers to the booking app also offering the ability to ask for assistance. Will he undertake to provide access to that data so that independent retail operators can provide a similar service in their booking systems?

It is my understanding that the system this Bill creates for GBR to engage with third-party retailers through ticketing will include the sharing of necessary data. I presume that would apply to such things. However, I will clarify that for the hon Member and get back to him on that point as I do not have the exact answer at the moment.

Amendment 34, tabled by the hon. Member for Broadland and Fakenham, seeks to clarify the application of the general duties in clause 18, and I thank him for it. It is important for the reformed sector that there is a set of duties shared by the key sector bodies, and that these duties apply to Ministers, GBR and the ORR. I am happy to reassure the hon. Members that clause 18(1) already sets out clearly that the duties will apply to Ministers, Great British Railways and the ORR when carrying out the functions specified in clause 18. There can, in my view, be no question as to who and what they apply to. In that regard the amendment is unnecessary from a drafting perspective, and does not provide greater legal certainty.

The hon. Member also asked about GBR’s purpose. Those functions and duties are quite literally GBR’s purpose. It seems to me that all this amendment does is rewrite them in a different format, but the functions themselves are clearly segregated for each organisation to which they apply. However, the duties apply to all and must be balanced by all.

On that basis, I commend clause 18 to the Committee. It sets out the general duties which will be shared by key players on the railway. The duties apply to GBR, the ORR, the Secretary of State for Transport and Scottish and Welsh Ministers. The duties will apply whenever those bodies carry out their relevant functions. The shadow Minister has already outlined what the duties are. If Members wish to have a look at them, they are on page 10 of the Bill, so I will not repeat them.

We believe that this common set of goals across the key sector bodies provides shared incentives to ensure that everyone works together to create the railway that we all want to see. The new duties also reduce the confusion, complexity and duplication that exists in railway legislation, allowing everybody to be clear on what their objectives are. While the functions in clause 3 of the Bill explain what we expect GBR to do, these duties set out what we want GBR to think about and achieve. Together, these two clauses set out the purpose of GBR, as the Government promised we would during the passage of the Passenger Railway Services (Public Ownership) Act 2024.

To conclude, clause 18 is a critical part of the Bill. It sets the foundation for how the key sector bodies will operate, guided by the public interest and empowered to deliver a railway that works for its users, taxpayers and the wider public. These duties are the core criteria that should guide every decision that GBR and others make about the railway. They are therefore imperative to the proper functioning of the future railway. I commend the clause to the Committee.

I am grateful for the Minister’s explanation. I do not intend to stand in the way of the clause standing part of the Bill. It is quite clear that it should do so in some form. However, I respectfully disagree with the Minister’s assessment of the consequence of the drafting where the duties are joint rather than joint and several and I will seek a vote on the amendment.

Question put, That the amendment be made.

39|0|3|9|The Committee divided:|Question accordingly negatived.||0|0

Amendment proposed: 35, in clause 18, page 10, line 17, at end insert—

“and to increase the number of passenger journeys in absolute terms and as a percentage of passenger journeys by mode of transport.”—(Jerome Mayhew.)

Question put, That the amendment be made.

40|0|4|9|The Committee divided:|Question accordingly negatived.||0|0

I beg to move amendment 33, in clause 18, page 10, line 23, at end insert—

“(g) in the manner best calculated to increase the number travelling by railway,

(h) in the manner best calculated to contribute to economic growth,

(i) in the manner best calculated to increase private sector investment and involvement in the railways and railway services,

(j) in the manner best calculated to remove or reduce the need for public subsidy of the railways,

(k) in the manner best calculated to increase levels of passenger satisfaction as monitored by The Passengers’ Council, and

(l) in the manner best calculated to improve efficiency and productivity in the delivery of railway services.”

With this it will be convenient to discuss the following:

Amendment 31, in clause 18, page 10, line 25, at end insert—

“(2A) The Secretary of State must set out in an annual report laid before both Houses of Parliament how it has balanced the requirements of paragraphs (2)(a) to (g).”

Amendment 32, in clause 18, page 10, line 37, leave out sub-paragraphs (a) and (b) and insert—

“(a) reliability, including punctuality, cancellations, short-forming, delays and the reliability of key connections,

(b) safety and security, including safety incidents, security incidents affecting passengers, staff presence, and the delivery of safety-critical maintenance,

(c) passenger comfort and on-board experience, including cleanliness, the functioning of heating, air-conditioning and lighting, overcrowding, the availability and performance of any internet connection or power sockets, and toilet facilities,

(d) affordability and value for money, including levels of fares, the availability of discounted or flexible fares, transparency of fare information, and passenger perception of value for money,

(e) passenger growth and network expansion, including growth in passenger numbers, the number of communities served, service frequency, and the provision of new or restored services.”

In oral evidence before the Transport Committee, Ben Plowden, the chief executive of the Campaign for Better Transport, said:

“We have a question about the difference in the duties between the way that freight is treated and passenger travel is treated: the duty on GBR and Secretary of State in relation to passengers is ‘to promote’ their ‘interests’, whereas it is ‘to promote the use of the…network’ for freight. Our view is that in order to incentivise GBR strongly—once it is set up—to grow the network and to grow passenger demand, there should be equivalent duties about passengers in clauses 18 and 17, so that GBR is required to promote the use of the network for passengers and future passengers, with a corresponding duty on the Secretary of State to set a passenger growth target. Our concern is that otherwise, the risk is that GBR might manage demand as a steady state, achieving its other objectives without necessarily seeking to grow demand by expanding the network or making better use of existing capacity.”

Hon. and right hon. Members will recall—although the only right hon. Member has done a runner—that Ben Plowden made a substantially similar point in oral evidence to this Committee. I think he prayed in aid the experience post covid, when all sorts of targets were met, but that was because there were not any trains running. He went on to say to the Transport Committee:

“It seems to us that the logic would suggest that if it is important for GBR to have a statutory incentive to promote a growth in freight traffic, it also ought to have a statutory incentive to do that for passenger growth. We know that the expansion and increase in capacity and connectivity in the rail network has huge socioeconomic benefits. Look at the Northumberland line that recently reopened; look at Crossrail. There are huge benefits from expanding network capacity and increasing the number of people who are able to travel by rail.

If you look at the Bill, it is interesting that service performance is defined in terms of ‘reliability (including punctuality)’ and ‘the avoidance or mitigation of passenger overcrowding’. There could be a scenario whereby GBR decided that, in order to meet its reliability duty”—

and this is the point—

“it reduced services to smooth them out and improve reliability, and in order to avoid overcrowding, it then introduced fares that”

managed

“demand, as has been suggested might happen on the west coast main line in the context of HS2.

There might be scenarios where, for perfectly logical reasons, internally GBR might decide that it did not want to increase passenger demand either on a particular route or overall. It seems to us that it would be sensible to have an equivalent duty or pair of duties in the Bill on passenger demand as it has for freight. GBR would need, as we were just discussing, to work out how to optimise that objective versus the other objectives it has set out in the duties and functions.”

That is a long quote, but I think that the Campaign for Better Transport makes a good point. The current drafting creates a duty to promote freight, but no such duty to promote passenger services. Amendment 33 would rectify that oversight by adding a number of excellent objectives: passenger growth, economic growth, private sector investment, reducing the need for public subsidy, increasing passenger satisfaction, and improving efficiency and productivity in the delivery of railway services. The amendment responds to the concerns of the passenger sector, which has clearly identified problems with the current drafting. Does the Minister have any intention of listening to the constructive advice from experts in the sector? I wait with bated breath, but I do wonder.

Amendment 31 would require the Secretary of State to report to Parliament annually on how he or she has balanced the requirements, to allow for better scrutiny. It is a cracked record from the Opposition that scrutiny and accountability need to be designed in. Who could disagree with that?

The other key part of clause 18 is the definition of “railway service performance” in subsection (3), which we have touched on a number of times. It is telling about current attitudes in the Department for Transport that reliability and avoiding overcrowding are all that the definition is—that is it. That is extraordinary. The definition of railway service performance is reliability and avoiding overcrowding. That is the most basic definition; there is no ambition to improve the service. I am concerned that we will see more of that approach when we have a nationalised GBR: a basic service where you get what you are given, you have no ability to demand improvement and you are meant to be grateful.

Amendment 32 challenges that approach and would inject some ambition into the Bill and—with a bit of luck—into GBR and its ability to strive for excellence once it is created. The amendment would insert into the definition:

“reliability, including punctuality, cancellations, short-forming, delays and the reliability of key connections”—

—we have heard from hon. Members how important connectivity is to the customer experience—as well as

“safety and security, including safety incidents, security incidents affecting passengers, staff presence, and the delivery of safety-critical maintenance…passenger comfort and on-board experience, including cleanliness, the functioning of heating, air-conditioning and lighting, overcrowding, the availability and performance of any internet connection or power sockets, and toilet facilities”.

Those are very important to passengers, and their experience of what it means to take a railway journey, as opposed to—if they have the ability—going by car. The definition would also include

“affordability and value for money, including levels of fares, the availability of discounted or flexible fares, transparency of fare information, and passenger perception of value for money,”

and

“passenger growth and network expansion, including growth in passenger numbers, the number of communities served, service frequency, and the provision of new or restored services.”

Finally, clause 18(2)(f)—it is tacked on to the end—is the only reference to value for money for taxpayers. It is right to focus on efficient use of funds, but does it need to be to the exclusion of much of the sector, with no comparison with costs or alternative provision? It is an important amendment, given that the Government are failing to show any customer focus. The drafting of the Bill appears to confirm the fears of the wider sector that GBR is going to be engineering-led and dominated by the historical culture of Network Rail. That shines out in this very bald definition of service.

Clause 18(2)(a) reads:

“in the manner best calculated to promote the interests of users and potential users of railway passenger services including, in particular, the needs of disabled persons”.

Is that not specifically saying that it is a duty to promote the needs of passengers and potential passengers? That is about passenger growth.

I am grateful to the Minister for her intervention, but it needs to be much clearer than that, because we are talking about the general duties of GBR. GBR will be able to rely on the definition and say, “We’ve satisfied our general duty under clause 18(2) because we have improved railway service performance as defined by the Minister,” which is reliability and the avoidance of passenger overcrowding. That is clearly wholly unacceptable and does not support the significant improvement that we all wish to see in the provision of passenger services.

We think that amendment 32 is important, since the Government are not showing a customer focus and are being overly led by an engineering mindset. It feels like they have chucked in a passengers’ council, which can be ignored because it has no enforcement powers, and then lip service is paid to the experiences of the passenger.

We already know that Great British Railways as an organisation is dominated by Network Rail. It is an organisation with about 41,000 members of staff, to which is added every six weeks or couple of months another operating company of 2,000 to 4,000 staff. It is quite apparent where, without intervention, the dominating culture will come from. We have to focus on improving customer experience as a whole, and it is for that reason that I will press the amendment to a vote.

It is a pleasure to serve under your chairship, Mrs Hobhouse. I will speak briefly and specifically on the attempt to introduce a passenger growth target. I think we have had the substantive discussion before, but it is worth briefly repeating the key points.

The railway, arguably, is already incentivised to prioritise passenger services. That is partly a financial matter, as the revenue coming in from passenger services is greater. However, I fear that the shadow Minister’s noble intent to move away from some current cultural practices is at odds with the clause. In the engineering culture, from a certain mindset, because freight trains are heavier and cause more damage to track, there is a convenience to allocating those rare paths to passengers services instead.

The shadow Minister quoted evidence, and I wish to read into the record some other comments that we heard, from Maggie Simpson of the Rail Freight Group, someone of whom I think the shadow Minister and I share a high opinion. Of a passenger growth target, she said:

“people think about the passenger railway all the time, so I do not see that that incentive effect is as necessary”.––[Official Report, Railways Public Bill Committee, 20 January 2026; c. 46, Q78.]

I think she put it very well: there is a real risk that if we put into the Bill both a freight growth target and a passenger growth target, with no prioritisation between them written in, one will have the effect of neutralising the other.

Does the hon. Gentleman not see the logic of the lobby group for rail freight saying that we should focus on rail freight while the lobby group in favour of the passenger, which I quoted earlier, says that there should be a passenger growth target? Does he not think that those representing passengers are better qualified to express an opinion on passengers than the rail freight lobbyist?

I am not sure that I follow the logic of the hon. Gentleman’s argument. Our job here is to look at the network and the service as a whole. This is an integrated, engineering, safety-critical industry of many parts, all of which interact with one another. This is a key point, and we have said it before: sometimes, hard choices need to be made about prioritisation. I fear that if we have the two growth targets sitting alongside each other with no weighting between them, what we will actually get is the status quo. Freight is, of course, essential to the economy and to decarbonisation, and we cannot run the risk of it being squeezed out.

I thank the shadow Minister for tabling the amendments. Amendment 33 would add further duties to clause 18. The proposed duties are either duplicative of existing provisions in the Bill or would constrain GBR’s operational priorities, undermining the directing-mind approach that the Bill implements.

Specifically, the proposed duty on passenger growth duplicates the existing duty to

“promote the interests of users and potential users”

of the railway. That duty will already require GBR to consider how to bring more passengers to the railway. As a passenger service operator, GBR will naturally be incentivised to grow passenger numbers in order to raise its own revenue, as my hon. Friend the Member for Birmingham Northfield so ably outlined.

The proposed duties on economic growth would also duplicate the public interest duty, which explicitly requires GBR to consider economic benefits when making decisions on the railway. The proposed duty on passenger satisfaction would duplicate the minimum consumer standards that we expect to include in the GBR licence. On the shadow Minister’s point about enforcement powers relating to the passenger watchdog, it is worth saying that the watchdog will set those minimum consumer standards, covering things such as accessibility and passenger information, in consultation with the Secretary of State and the ORR. It can also request enforcement from those bodies, as well as improvement plans from GBR. There are mechanisms to ensure that accountability takes place.

The Minister says the watchdog can request enforcement. Does it have the power to compel enforcement?

As I said, it has the power to request enforcement, and that is important because, ultimately, GBR needs to be able to take those decisions but have robust accountability from the ORR and the Secretary of State should it not have regard to things such as its duties, one of which is to promote the interests of passengers with disabilities. But the watchdog plays an incredibly important oversight function in ensuring that GBR is not remiss in its duties.

The proposed duty on efficiency and productivity is already in the Bill: there is a cost-efficiency duty in clause 18. On the proposal to increase private sector involvement, we want GBR to co-operate with the private sector to create the best possible railway for everyone, but not to increase private sector involvement as a stand-alone goal. There will be times when increasing private sector involvement will be needed, such as when it comes to freight growth, and the Bill already provides for that, but it should not be an end in itself. Rather, GBR should focus on delivering for passengers and taxpayers in the best possible way, using all the options available to it. The duties in the Bill are clear, and introducing additional, duplicative detail will not help GBR to deliver effectively. I therefore urge the shadow Minister to withdraw amendment 33.

Amendment 32 would replace the current definition of railway service performance in the Bill with a longer list of criteria, including reliability, safety, passenger comfort, affordability, passenger growth and the establishment of new services. Those are all important issues, but the Bill already requires GBR to focus on performance, including specifically reliability, punctuality and the avoidance of overcrowding. Those are top passenger priorities when it comes to train performance. Matters such as cleanliness, passenger comfort and value for money will already be considered as part of the passenger interest duty and through minimum consumer standards, which the passenger watchdog will set.

Clause 18 already requires consideration of the social and economic benefits that can be derived from the railway, which will include considering where new services might be needed. That is one of the core benefits of GBR: it will be able to look across the entire network holistically. There will be greater opportunity to maximise our limited capacity and potentially create new services compared with the current system.

Does my hon. Friend agree that under this provision, with the right economic drivers, there could be consideration in future for family-friendly trains—a service seen in some parts of Europe, where entire carriages are set aside for toddlers and children to travel in comfort, which might no doubt also increase the comfort of passengers not travelling with children?

I thank my hon. Friend for her contribution as part of this debate, and throughout our proceedings, on the importance of accessibility for people with disabilities and for parents with children. She has already shared with me, for my benefit, examples from across Europe of where family-friendly accessibility measures are baked into the way train services operate. One notably striking example was of a children’s playground in a railway carriage in Finland.

We hope that accessibility in all its forms can be embedded into GBR’s operational processes, including where it creates new opportunities for things like additional passenger services. I also point my hon. Friend to the fact that the rolling stock and infrastructure strategy is a really important piece of the puzzle in ensuring we have rolling stock that is unified in its capacity to offer better services for passengers with disabilities and for families travelling on our railways. Her point is very well made.

The Government are committed to ensuring that Britain’s railway continues to rank as one of the safest worldwide and, as promised, the Bill does not change that safety regime. In my view, there is no need for further safety duties in the Bill. In short, everything that amendment 32 seeks to do is already in the Bill’s provisions, so to include it would be duplicative and would muddy the definition of “performance”.

Amendment 31 is intended to require a report on how GBR has balanced the general duties in clause 18, but the amendment is unnecessary. The clearest account of how GBR has balanced its duties will be set out in its published business plan, which the ORR must advise on and the Secretary of State must approve—both reviewing the plan with those same duties in mind.

Will the Minister clarify his argument? I ask because a business plan by its nature looks forward, whereas a report looks backward and marks homework. How can the business plan mark homework?

Regard will have to be paid to the business plan over the period for which it is implemented. It will also be possible to tell, on the business plan’s completion, whether it has been completed in a way that is cognisant of and reflects GBR’s duties. The Secretary of State will review the business plans with the duties in mind, as set out in clause 18. That approval process is in itself an assessment of how GBR has balanced its duties, affording lessons as to how they have been applied in the past but also, as the hon. Member is right to point out, for the future.

The approval process is designed so that the bodies can provide checks and balances on each other, through co-operation and constructive challenge, ensuring that the common objectives are achieved in the best way possible. The business plan and the advice relating to it will be published, so Members can follow along and scrutinise whether GBR is appropriately balancing its duties at all times. This is already a transparent reporting system. I therefore urge the hon. Member for Broadland and Fakenham to withdraw or not press these amendments.

I am aware that we need to make progress in this Committee, so I will not press every amendment to a Division. I am not persuaded by the Minister’s arguments in relation to amendments 32 and 33, but I will not press amendment 31 to a Division. I wish now to press amendment 33 to a vote.

Question put, That the amendment be made.

41|0|3|9|The Committee divided:|Question accordingly negatived.||0|0

Amendment proposed: 32, in clause 18, page 10, line 37, leave out sub-paragraphs (a) and (b) and insert—

“(a) reliability, including punctuality, cancellations, short-forming, delays and the reliability of key connections,

(b) safety and security, including safety incidents, security incidents affecting passengers, staff presence, and the delivery of safety-critical maintenance,

(c) passenger comfort and on-board experience, including cleanliness, the functioning of heating, air-conditioning and lighting, overcrowding, the availability and performance of any internet connection or power sockets, and toilet facilities,

(d) affordability and value for money, including levels of fares, the availability of discounted or flexible fares, transparency of fare information, and passenger perception of value for money,

(e) passenger growth and network expansion, including growth in passenger numbers, the number of communities served, service frequency, and the provision of new or restored services.”—(Jerome Mayhew.)

Question put, That the amendment be made.

42|0|4|9|The Committee divided:|Question accordingly negatived.||0|0

I beg to move amendment 36, in clause 18, page 10, line 41, at end insert—

“(5) In this section, Great British Railways must make an assessment of the effect of procuring services from businesses in the private sector in meeting its duties under subsection (2)(f).”

With this it will be convenient to discuss the following:

Amendment 42, in clause 31, page 17, line 2, after “public” insert “or private.”

Amendment 43, in clause 31, page 17, line 8, after “public” insert “or private.”

Amendment 98, in clause 74, page 43, line 5, at end insert—

“(d) whether the procurement of services from the private sector would represent a more efficient use of public funds.”

Amendment 236, in clause 74, page 43, line 5, at end insert—

“(d) whether the procurement of services from private sector suppliers would allow for more efficient use of public funds.”

New clause 43—Private sector growth target—

“(1) The Secretary of State must publish a target for increasing private sector involvement in railway services and infrastructure for each financial year.

(2) The target under section 1 must include, but is not limited to increasing the role of the private sector in—

(a) supply chains, and

(b) open access.

(3) The Secretary of State—

(a) must keep the target under review,

(b) may revise or replace the target, and

(c) must publish any revision or replacement to the target.

(4) Great British Railways must, when exercising its statutory functions, have regard to the target set by the Secretary of State under this section and any policy of the Scottish Ministers relating to the investment of the private sector in railway services and infrastructure in Scotland.”

Let us go straight into amendment 36, which would require GBR to benchmark the cost of its activities against similar provision through the use of the private sector. That is important, because if competition is removed, there is literally no benchmark against which to judge the effectiveness and efficiency of the organisation. Without comparison, where is the value in clause 18(2)(f), which says:

“taking into account the costs that will need to be met from public funds and the need to make efficient use of those funds,”?

What benchmark will the organisation have if it does not cross-reference against alternative providers?

The amendment would require GBR to assess whether

“procuring services from…the private sector”

would help it to meet its value for money duty. I should make it clear for Labour Members who are considering supporting this amendment that it would not require GBR to choose a private sector provider, but it would require it to benchmark against the private sector.

Procuring from the private sector could enable access to specialist expertise, innovation—dare I say that?—and competitive pricing, helping to deliver better value for money and more efficient outcomes for taxpayers. Will the Minister listen to the concerns of the industry and support this amendment, which seeks to make GBR an organisation that cares about passengers and taxpayers at the same time?

Amendments 42 and 43 would amend clause 31, on the provision of railway passenger services, which we will get to in due course. The clause currently allows the Secretary of State to award a licence only to a public-sector company. It cannot be in the best interests of the taxpayer to exclude even the consideration of alternative providers based on their ability and value for money. This is one of the most blatant examples of political ideology trumping pragmatism. The amendments would grant maximum flexibility to a future Secretary of State and Scottish and Welsh Ministers to make an award to the organisation, public or private, that is best placed to undertake the operation. It seems obvious that we should allow that degree of flexibility to the organisation and the Secretary of State in future.

Amendment 98, which is tabled in my name, would require the Office of Rail and Road to consider whether it would be a

“more efficient use of public funds”

for GBR to procure services from the private sector. It echoes the other amendments in this group but would amend clause 74, which, as everyone will remember, relates to the ORR’s monitoring duties towards GBR. Amendment 236 would also amend clause 74 to require the Office of Rail and Road to assess whether procuring services from the private sector would better enable GBR to meet its value for money duty.

New clause 43 relates to a private sector growth target. It would require the Secretary of State to publish a target for increasing private sector involvement in railway services and infrastructure for each financial year, including its involvement in supply chains and open access. Just because we want GBR to be a success, let us not forget that, even once established, it will be a minority interest in relation to the rail sector as a whole. There is not just open access—there are all sorts of other users of and suppliers to the railways—so we can have both duties. They are not mutually incompatible. The new clause would require that the target must be kept under review and that GBR must have regard to it when exercising its statutory functions.

The private sector is best at providing us with innovation and efficiencies and should therefore be used to ensure that GBR can be the best version of itself. In more common parlance, we need the private sector to keep GBR honest. The Bill designs the ORR and the Secretary of State out of comparing GBR against a thriving private sector. Surely it makes sense to give the Secretary of State all the tools in the box to allow her to drive efficiency in GBR and cross-check value for money for the taxpayer.

Could the shadow Minister advise me whether there is anything in his amendments or new clause that would exclude foreign state-owned railway enterprises from that definition of “private sector”?

The hon. Member is as capable of reading the amendments as I am of drafting them. I do not want to get hung up on that, but my working assumption and my assertion to him is that the ownership structure internationally may be a state-owned organisation, but the delivery body in the United Kingdom would be a for-profit, private organisation, so it would pass the test of being in the private sector. Jolly good news too—if the British taxpayer can benefit from the largesse of the foreign taxpayer providing a more competitive service for whatever the Secretary of State is seeking to contract for, that is a wonderful thing. That is a gift from abroad, and we should be encouraging it.

Before I get into to my substantive points on this amendment, I want to circle back to a query the shadow Minister raised earlier, via an intervention, about accessibility and data sharing. I have a little more specificity to share with him: independent retailers will have the same opportunity as GBR to provide passenger assist to customers, and we are absolutely committed to a fair and open market. As part of this, the ORR’s code of practice will ensure that retailers get sufficient access to systems and data.

I am very grateful.

Amendment 36 would require GBR to make an assessment of how procurement from the private sector could help it meet its value for money duty. The amendment is drafted on the basis that GBR would otherwise be uninterested in working with the private sector, but I highlight to the Committee that that is not currently the case for Network Rail and will not be for GBR either.

Currently, Network Rail spends, on average, around £8 billion per year with more than 4,000 rail suppliers. We expect that, in future, at least 60% of expenditure by GBR could feasibly be spent in the private sector. By providing a more integrated approach across track and train, and greater long-term certainty, GBR will be in a position to give the private sector the confidence it needs to invest, support innovation and promote the adoption of new technology.

When discharging its duties under clause 18, GBR must consider the efficient use of taxpayers’ money, and it must be able to decide the most appropriate way to do that. That is the basis of the principle of decentralising decision making away from Government and empowering GBR to run the railway. Prescribing a specific assessment of potential private sector involvement, which might not always be relevant every time GBR discharges that duty, would itself be an inefficient use of funds.

Amendments 42 and 43 would allow private sector companies to operate passenger trains for Scottish and Welsh Ministers and the Secretary of State. The Government were elected on a clear manifesto commitment to return franchised passenger services to public ownership. Public ownership is the only way to make the railway run better, with the whole system working to one set of clear objectives.

If that is the clear objective of the Government, why are they allowing open access to continue?

The shadow Minister pre-empts what I am sure will be a spirited debate about open access in later clauses. Open access provides a proportionally very small percentage of passenger services on the railway, but it makes a really important contribution, especially in terms of inter-city links, which I personally benefit from with Hull Trains running from Selby to London. GBR does not want to lose the benefits that open access can provide. In fact, having a more streamlined and cohesive railway, as a result of GBR’s responsibility for capacity, could even increase the ability for open access services to run on within the network.

That does not change the fact that, in our view, overwhelmingly across the UK, public ownership is the right way to make the railway run better, as it can work to a whole-system approach and a clear set of objectives to improve reliability, performance and punctuality for passengers. Privatisation created conflicting priorities and complex contracts that cost the taxpayer £150 million annually in unnecessary fees. A 2020 report found that Network Rail and train operators were employing hundreds of people just to work out who was to blame for disruption.

That system was outrageous, and it was symptomatic of a privatised system in which operators were financially incentivised to point fingers instead of fixing problems. We cannot continue with no one in charge, and the Bill makes it clear that, in future, GBR will be responsible for making the railway work, and no one else.

When the Minister talks about wasting money on people being employed to argue with each other about who is to blame, I think of what his colleagues are doing in the Department of Health and Social Care with NHS England, by removing that culture and not having two state organisations delivering health. Does he envisage a problem here with the Department for Transport and GBR both having some responsibility for delivering rail and getting into a situation where they are doubling up on capacity and arguing about who is responsible for what?

With respect to the hon. Member, I do not think that those two examples are analogous. The Secretary of State has a responsibility to set out the long-term rail strategy, to guide how GBR will work over the decades to come, but in terms of access, charging, passenger experience and making sure that our railway runs for every part of the United Kingdom, GBR will be solely responsible for that work. Therefore, I do not believe that the NHS England comparison works in this instance.

Both amendments 98 and 236 would require the ORR to consider whether GBR procuring services from the private sector would be a more efficient use of public funds. In carrying out its monitoring role, the ORR is already under a duty to consider the efficient use of taxpayers’ money, alongside duties to promote the interests of passengers, the use of rail freight and the public interest. Prescribing a specific and focused test that the ORR must apply when monitoring the delivery and outcomes of GBR’s activities is ideologically driven and adds nothing to the already comprehensive monitoring role that the ORR possesses.

The ORR’s monitoring and advisory role, His Majesty’s Treasury spending controls and external scrutiny will all ensure proper value-for-money scrutiny. If the ORR thought there was a significantly better value-for-money way of achieving a certain objective than the one proposed in the business plan put forward by GBR, the ORR could highlight that to GBR and the Secretary of State. The Bill therefore already delivers this intent.

New clause 43 would require the Secretary of State to set a private sector growth target. I agree that the private sector has a vital role to play in our railways. That is true across the supply chain—in rolling stock, freight, open access services, ticket retail and innovation—and nothing in the Bill seeks to exclude or marginalise that contribution. However, we do not agree that imposing a statutory growth target for private sector involvement is the right approach.

The Bill establishes Great British Railways as the single directing mind for the railway, responsible for balancing its statutory duties in the round. Those duties include promoting the interests of passengers and potential passengers, making efficient use of public funds, promoting the use of rail freight and enabling providers to plan for the future of their businesses. Those are the right incentives to create the railway that we want—one that is reliable, connected, effective and brings together the best of the public and private sectors to deliver for the general public. Private sector growth in isolation, without regard to those aims, could drive the wrong incentives and will not create the railway that we all want to see.

The Bill is designed to secure the best of both worlds. GBR will simplify engagement and provide clearer long-term direction and greater certainty, while continuing to procure billions of pounds’ worth of goods and services from private sector suppliers. We expect that a substantial proportion of GBR’s expenditure, once established, will continue to flow through the private sector. Open access operators will continue to play a role where they add value and represent best use of the network, supported by fair and transparent access and charging arrangements, with appropriate regulatory safeguards.

The supply chain will benefit from longer-term strategies and more coherent planning than the fragmented system delivers today, and the duties reflect the need for private sector providers to plan with certainty. What matters is not meeting an arbitrary target, but delivering better outcomes for passengers, freight and the taxpayer. A statutory private sector growth target would add rigidity where flexibility and judgment are required. In the light of all those reasons, I urge the hon. Member for Broadland and Fakenham not to press the amendments and the new clause.

Before I call the shadow Minister, I advise him that we will only decide on amendment 36 at this point; decisions on the other amendments will come later.

Thank you, Mrs Hobhouse; I am grateful for that guidance. Amendment 36 is a bench-marking amendment. It is absolutely crucial to keep GBR honest in the future when it comes to value for money, in particular for the taxpayer. I will certainly press it to a Division.

Question put, That the amendment be made.

43|0|3|9|The Committee divided:|Question accordingly negatived.||0|0

Clause 19

Safety duty of Ministers and ORR

Question proposed, That the clause stand part of the Bill.

Clause 19 ensures that the existing safety duty under section 4 of the Railways Act 1993 will be preserved in full and continue to apply to the relevant sector bodies. Safety is a critical priority for the Secretary of State and for this Government. The clause is necessary to fulfil the Government’s commitment that the Bill will not alter the existing legal framework underpinning rail safety, which has led to Britain’s railways consistently ranking as among the safest in the world. That is all I have to say on the clause.

I can beat that. The clause appears necessary, and it is not one that His Majesty’s Opposition will object to.

Clause 20

Competition duty of ORR

I beg to move amendment 237, in clause 20, page 11, line 21, leave out paragraph (c).

With this it will be convenient to discuss the following:

Amendment 37, in clause 20, page 11, line 22, leave out paragraph (d).

Amendment 210, in clause 20, page 11, line 22, leave out paragraphs (d) and (e).

Amendment 238, in clause 20, page 11, line 23, leave out paragraph (e).

Amendment 239, in clause 20, page 11, line 24, leave out paragraph (f).

Amendment 240, in clause 20, page 11, line 25, leave out paragraph (g).

Amendment 267, in clause 20, page 11, line 25, at end insert—

“(h) its functions as the enforcement body for rail passenger rights and obligations, consumer protection and accessibility, including passenger related licence conditions.”

Amendment 38, in clause 20, page 11, line 27, after “competition” insert

“and deliver value for money”.

Amendment 268, in clause 20, page 11, line 28, at end insert

“provided that such exercise does not adversely affect passenger rights, network integration or unreasonably increase the cost to public funds of providing railway services.”

Clause stand part.

I hope I am not going to miss out any of those amendments, Mrs Hobhouse, but it is going to be quite a challenge. Clause 20 concerns the “competition duty” of the Office of Rail and Road; it sounds pretty good when you read that title but the clause gets progressively less and less good once you delve into it.

The clause requires the ORR to promote competition in the exercise of its functions, subject to certain exceptions. Exempt activities relate to safety, train driver licensing, the funding of GBR, GBR’s access process and decisions in relation to railway infrastructure, licence enforcement, functions under the Competition Act 1998, and monitoring GBR, where the Government believe that other considerations are equally or more important than the need to promote competition.

The Government claim that they want the Office of Rail and Road to have a powerful role to monitor GBR and to promote laudable objectives such as

“competition….for the benefit of users of railway services.”

On the face of it, that is welcome. It is a sound principle, after all, that monopolies—whether they are public or private—are rarely in the interests of the consumer. It is for that exact reason that we created, over time, arms of the state such as the Competition and Markets Authority to break up anti-competitive monopolies in the private sector, although GBR is another monopoly that the Government are setting up, in the other direction.

However, when we dig into the detail of what subsection (1) of the clause exempts from the competition duty, the picture becomes considerably less attractive. Excluding from the competition duty chapter 1 of part 3 of the Bill means that key parts of GBR’s operation, such as the access and use policy and capacity duty—two very important issues—are not covered by the duty of competition. That effectively makes GBR all-powerful over any other operator, be it devolved, open access or freight. That is not competition; that is a designed monopoly.

The Minister has said that the Government have taken that decision because they want GBR to be a single controlling mind, but GBR will not be the only operator on the railways. The Minister, just a moment ago, said that there are circumstances in which he would wish open access to flourish and grow, yet the Bill as drafted does not give any confidence to that sector that an operator can put forward a business case and attract investment because such an operator does not know whether there will be fair competition around crucial elements of its business case—elements as basic as whether it will get access to the railways. In the Bill, such competition is specifically, expressly excluded.

The exceptions in the clause are key to understanding the true intentions of the Government. Despite the appearance that the clause allows the Office of Rail and Road to promote competition, examination of subsection 1(d) shows that the Office of Rail and Road is required to promote competition unless it gets in the way of the access and use policy, which—as the Committee will discuss later—does not promote competition at all.

Elsewhere, the Government appreciate the positive impact of competition. Look at international rail. Lord Hendy took the trouble to write to the Office of Rail and Road in July last year, and said:

“The Government firmly believes that the arrival of competition will benefit users of international rail services by expanding the number of stations served (including new markets), encouraging greater differentiation in service provision and promoting competitive prices.”

I could not have written it better myself. The Government are clearly sending out extraordinarily mixed messages: competition is good, except when it is against the Government. Those statements cannot both be right, can they?

Let us see what the evidence demonstrates. The ORR quarterly figures on passenger rail usage are a valuable source to evaluate the impact that open access operators—competition—have made on the rail market. Three long-distance open access operators in the UK operate on the east coast main line. In comparison, the Great Western main line and the west coast main line currently have no open access operations. The ORR figures enable us to get what is admittedly a high-level understanding—there will be other factors at play, but it is instructive—of the impact that open access operators can have on the rail network by comparing east coast main line passenger demand to the Great Western main line and the west coast main line. These are Government figures for April to June 2025, and they were published on 30 October last year. They showcase that all long-distance operators on the east coast main line are growing against 2019 figures.

Combining the operators on the east coast main line, the route is currently seeing journey growth of 30%, compared with the pre-covid level in 2019. We must bear that in mind. One of those is nationalised—LNER—and the others are open access, but in combination there has been 30% growth. LNER passenger growth was 23% in 2024-25, compared with 2018-19—pre-pandemic levels. Grand Central passenger growth was 20% in 2024-25, and Hull Trains passenger growth was 54% in 2024-25, compared with 2018-19. The fact that long-distance passenger growth on ECML, including Lumo, was 30% in a year clearly demonstrates that all operators are growing on the east coast main line. That includes the impact of Lumo commencing in October 2021.

In comparison, the two dominant operators on the Great Western main line and the west coast main line have seen 9% and 10% fewer journeys than in 2019 respectively. That is really important. The Great Western main line data is impacted by the transfer of suburban services to TfL Rail in 2019, so it is not as good an indication—I am highlighting a potential difference—but there is still a noticeable difference in the direction of travel of performance. The Committee should ignore it at our peril, because we would be turning our face against the data to advance our political beliefs.

The difference between the east coast main line and the west coast main line is further amplified when comparing the latest Civil Aviation Authority data from September 2025, which records passenger movements between UK airports. Although rail journeys figures on the east coast main line have grown by more than 30%, the number of people travelling between Edinburgh and London by air has fallen by 13%, from 3.4 million to 2.9 million journeys. In contrast, the number of people travelling between Glasgow and London by air has fallen by only 9%, broadly in line with the overall west coast main line rail market, which has seen a 10% fall in journeys.

We have to ask why that is. Although those rail figures reflect markets on the route and not specific flows, it can be assumed that air has lost market share to rail on the east coast main line between Edinburgh and London, and not on the west coast main line, where there is no open access challenger between Glasgow and London. The difference between the east coast main line and the west coast main line is therefore stark, with all the east coast main line operators experiencing significant rail passenger growth volume while the west coast has still to get back even to 2019 levels—a difference that is amplified by the larger drop in air passenger demand between Edinburgh and London versus Glasgow and London.

While several factors will be contributing to the difference between passenger demand performance for both, the biggest difference is open access operations, which are providing choice, value and capacity to grow the market. The evidence, if we are interested in evidence, is overwhelming that competition drives down prices and drives up services, just as Lord Hendy said it would in relation to international travel.

I do not dispute some of the points that the shadow Minister makes on open access, but could he tell us a little more about how this relates to his perspective on the access regime? One of the reasons open access is unable to thrive on the west coast main line is insufficient capacity, and part of the access challenge is created by Network Rail and the ORR not having a cohesive system for managing access and timetabling in a way that makes sense. Would having one unified body to manage that access regime not allow open access opportunities to be realised in shorter order?

It may well do, in short answer. The Minister makes a valid point: having a single point of contact for this may well have a benefit. Of course, it could be the Office of Rail and Road as opposed to GBR, but the real problem, which we will come on to in a few hours—or days—is the drafting of clause 63, which concerns the capacity duty and the very onerous level that open access operators will have to get above in order for GBR to consider that there is sufficient excess capacity to allow for new services. As clause 63(2) states:

“Great British Railways must exercise the functions so as to ensure that it retains sufficient capacity over GBR infrastructure to allow for…the operation of GBR passenger services and of railway passenger services that it expects will in future be GBR passenger services”.

That is a bar, I suggest, that no open access application could ever get over. GBR gets a get-out-of-jail-free card.

No one likes competition. When I ran businesses, I did my best to avoid competition as much as I could. The inclination of GBR will be no different. It will not want to be shown up by competition. It will not want its market to be pinched by competition. All it will have to do is look at clause 63 and say, “There you go. At some stage in the future we might think about having something there,” and Bob’s your uncle. Then what can the open access operators do? They could say, “That is a terrible decision. We’re going to appeal it. Even though the bar is so high in legislation that it is almost impossible to appeal, we’re going to the ORR because clause 67 says that any organisation that is disgruntled at such a decision has a right to appeal.”

Look at what the appeal duty provides for: organisations can go to the ORR, and there is an appeal akin to judicial review in the High Court, meaning that there can be no appeal at all on the application’s merits, which cannot be reopened. No evidence regarding whether there is a good business case can be considered—just whether there has been an error of law, or whether an organisation properly constituted could have come to that decision without irrationality. That is what the judicial review principles mean. Furthermore, organisations have to put in their application for judicial review within three months of the commission of the event against which they are complaining. It is incredibly onerous, and perhaps the single biggest problem with the drafting of the Bill is a combination of those two issues.

That was a very enjoyable aside, but I need to get on to the amendments—you are probably relieved to hear that, Mrs Hobhouse. Amendments 237, 37, 238, 239 and 240 essentially all serve to apply the ORR competition duty to GBR functions, to serve the passenger rather than the organisation of GBR. That is what we need to focus on time and again: this organisation is to serve the passenger, not itself as an organisation. The amendments would keep alive the role of open access operators as challenger brands to GBR, forcing GBR to up its game and stay honest, just as we have seen with the nationalised operator on the east coast main line.

Just because there would be competition, that does not mean that GBR would wither and decline. As we have seen on the east coast main line, competition drives increased performance and results from all organisations when properly applied. Competition is always uncomfortable. I complained about it many times in my previous business career. Many businesses, including my own, would have loved to be able to regulate it away. All the more reason for the Government to stand up to GBR in the interests of passengers.

The Minister was quite right to say that it is a positive step that GBR will have oversight of the whole network. However, we want to see the ORR’s competition powers in these areas restored as a way to ensure that GBR, while having a reasonable duty to look at and balance the needs of the network as a whole, does not unfairly discriminate against other operators because we have GBR as referee and player. That is clearly a designed, structural conflict of interest. We need to have the ORR focusing on competition and holding the ring.

Amendment 237 deals with funding, amendment 37 deals with access, amendment 238 deals with railway closures, and amendments 239 and 240 deal with advice to the Secretary of State and amendment 240 also deals with advice to the Secretary of State. I know all Members will have read those amendments, so I will not take the Committee through them one by one in the interests of time.

Amendment 38 would insert

“and deliver value for money”

after “competition” in clause 20, page 11, line 27. We do not need the Office of Rail and Road just to fight the cause of competition; it is also about value for money for the taxpayer. We have already heard that about 50% of all money spent on the railways at the moment is taxpayers’ money, not farebox money. It is therefore crucial that the ORR should have a duty to ensure that GBR delivers value for money. The general duty, as set out in clause 18, is to have regard to the “efficient use” of public funds. That is clearly insufficiently strong. In the absence of other private passenger operators, whether via open access or a devolved concession, which would be equally powerful as a comparator for GBR’s performance, against what will GBR’s efficiency and performance on value for money be measured? Amendment 38 would correct the language in clause 20. I have not made it up myself; it has been considered and approved of by the sector as a whole—people standing up for passengers. On amendments 37, 41, 42 and 43, Rail Forum said:

“Again, this is desirable to ensure some competition.”

I have spoken to all my amendments, but I would also like to speak about amendment 210, which is in the name of the hon. Member for Didcot and Wantage. The amendment also removes the exemption of the ORR’s duty to promote competition in regard to GBR’s access process. It is a variation on a theme. We are all pushing in the same direction because we are trying to stand up for passengers, and I hope the Government will too.

As the shadow Minister said, amendment 210 is our attempt to strengthen the ORR’s role in access decisions, so we agree with some of the Conservative amendments, but not all of them.

Let me explain the context. In an ideal world, I would not want to see competition between passenger services decided by the ORR, for two reasons. First, the current way that open access is run on our railways can be complicated, suboptimal and inefficient, although in certain places it is producing good results, such as on the east coast main line, as the shadow Minister said.

The second reason is that the ORR does not always cover itself in glory in its current form, as per its notorious decision, quickly reversed, about the 0700 express from Manchester to London. I have tabled new clause 56, which we will come to later, which suggests a different way of promoting competition on the railway: it would institute a centrally decided timetable, and some of the paths on routes that have more than one train an hour would be auctioned off. For example, three trains an hour run on the London to Manchester route, and GBR would intentionally introduce competition by auctioning off one train path an hour, which hopefully would encourage both sides to pull their socks up. We have increasingly seen that happening on the Italian high-speed network and in France. Absent that, we feel—with those caveats having been issued—that it would be beneficial for the ORR to retain stronger powers in relation to access and competition. That is why we have put forward amendment 210.

The amendments in this group relate to the ORR’s competition duty and primarily look to remove the various exemptions set out in clause 20. I will begin by saying that we of course recognise the benefits that competition can bring to railway users and the economy at large. In the supply chain, competition drives innovation and efficiency. In the online retail market, competition provides choice and drives up the quality of passenger experience. However, although competition may be a powerful means of achieving a goal—such as innovation—there are many railway functions where it would not be appropriate, and could even be counterproductive, to treat competition as a goal in itself. That is true of many of the ORR’s functions in the new model.

Amendments 237 and 240 look to apply the ORR’s competition duty when it is advising the Secretary of State on GBR’s business plan, and when monitoring GBR’s activity against that business plan. It would also apply the ORR’s competition duty when it was monitoring GBR’s activities against its railway safety purposes. Our view on this matter is clear: if competition is not improving the railway for the passenger, taxpayer or economy, we will not be pursuing it. Competition for competition’s sake is ideological and does not help us to achieve the goal of making the railway work better.

When creating its business plan, GBR will need to take into account economic considerations, as set out in the public interest duty in clause 18; and when the ORR reviews the business plan to ensure that it offers value for money, it will be applying the same tests relating to the economy and cost efficiency. It would not be right for the ORR to overlay an additional competition objective on to that advice when the purpose of the advice, as clearly set out in the Bill, is to scrutinise GBR’s proposed business plan to ensure that GBR can deliver on the Secretary of State’s objectives in a value for money way. That should be a simple assessment of performance, not a way to pursue separate goals.

Amendments 37 and 210 would require the ORR actively to promote competition when hearing access appeals. The nature of the appeals role is a broader point, which we have covered to a small extent today and which I am sure we will cover in greater detail in a few days’ time, so I will endeavour to be brief now. The Bill establishes a robust and fair framework to enable GBR to take decisions on the best use of the network. The ORR’s appeals role is designed to ensure that GBR acts lawfully, fairly and consistently with its duties, but it is not there to supplant GBR as the directing mind by wholly retaking strategic decisions or applying a different decision-making framework.

An active duty for the ORR to promote competition at the appeal stage would undermine that, effectively creating two decision makers, applying two different yardsticks, at different stages in the process. In fact, two different bodies taking decisions based on different criteria is exactly what we have at the moment with Network Rail and the ORR, and this is fertile ground for exactly the kind of conflict, disagreement and delay that plague the current access regime and that our approach is designed to fix. That is part of the system that has failed to deliver for passengers and taxpayers and that we absolutely must move away from if we want a better railway.

Amendment 210 would have the additional effect of applying a competition duty to the ORR’s enforcement of GBR’s licence. That is also the focus of amendment 238. The ORR’s task when enforcing the licence is to ensure compliance so as to provide legal and regulatory certainty. Applying a competition duty to this function would distort the purpose of these powers. The amendment would therefore undermine the regulatory framework and be counterproductive.

Flirting with tautology, amendment 239 would require the ORR to promote competition when exercising its competition powers under the Competition Act 1998. The Railways Act 1993 establishes the ORR as the competition regulator for the sector, alongside the Competition and Markets Authority. To ensure effective regulation, the two must act according to the same rules, without interference from sector-specific priorities. That is why neither the ORR’s railway competition duty nor the other ORR-specific duties apply when it is acting as a competition regulator. This is a continuation of the current approach to regulating competition in legislation and not one from which we should deviate.

Amendment 38 is not necessary, as it simply duplicates clause 18(2)(f), which already requires the ORR to take

“into account the costs that will need to be met from public funds and the need to make efficient use of those funds”.

An additional requirement to consider value for money would therefore be redundant.

Amendment 268 seeks to ensure that the ORR exercises its duty to promote competition in a way that does not adversely affect issues such as passenger rights, or unreasonably increase costs to public funds. I support the spirit of this amendment and its focus on safeguarding passenger rights, the smooth operation of the railway and the public purse. It is precisely because I agree with those aims that clause 20 already ensures that the ORR will not be subject to a duty to promote competition when carrying out certain functions.

Further, the Bill already protects public funds through clause 18. It includes an obligation on the Secretary of State, the ORR and GBR to consider cost efficiency, which should ensure that the value for money that the hon. Member for Broadland and Fakenham is looking for is delivered. When the ORR considers value for money in the context of GBR’s business plan, the Bill ensures that it will not be distracted by the irrelevant consideration of promoting competition.

Regarding passenger rights, the ORR’s competition duty, where it applies, is specifically to

“promote competition...for the benefit of users of railway services.”

It will therefore not be promoting competition except for the benefit of passengers. That wording, plus the fact that the ORR will continue to be the enforcer of passenger rights and consumer law, means that the ORR is already set up to recognise the importance of passenger rights. The Bill already sufficiently protects passengers’ rights, effective running of the network and taxpayer funds ahead of competition, so there is no need to duplicate efforts by making the amendment.

In summary, clause 20 rightly requires the ORR to promote competition when it exercises its functions, subject to some specific and necessary exemptions, which I have just explained in detail. I therefore urge hon. Members not to press their amendments.

You will not be wholly surprised, Mrs Hobhouse, to know that I am entirely unconvinced by the Minister’s arguments. This is one of the key differences of opinion between the Government and the sector, and I seek to give the sector a voice through my amendments and my submissions. I will look to you, Mrs Hobhouse, for guidance on the exact process; I intend to press some amendments to a Division, but not all of them, to save a bit of time for everyone.

If the hon. Gentleman wishes to press amendment 237 to a vote, once that is decided, the other ones will follow.

To give you an advance clue, I intend to press amendments 237 and 37 to a vote. Depending on the outcome of the vote on amendment 37, I may not seek to divide on the others, apart from amendment 38.

Okay. Olly Glover, do you intend to press amendment 210 to a vote?

One moment, Mrs Hobhouse.

My opinion is that they all basically deal with the same principle. I also remind the Committee that we need to move on to other issues.

I shall not then, Mrs Hobhouse. Thank you for your guidance.

Question put, That the amendment be made.

44|0|3|9|The Committee divided:|Question accordingly negatived.||0|0

Amendment proposed: 37, in clause 20, page 11, line 22, leave out paragraph (d).—(Jerome Mayhew.)

Question put, That the amendment be made.

45|0|5|9|The Committee divided:|Question accordingly negatived.||0|0

Amendment proposed: 38, in clause 20, page 11, line 27, after “competition” insert “and deliver value for money”.—(Jerome Mayhew.)

Question put, That the amendment be made.

46|0|5|9|The Committee divided:|Question accordingly negatived.||0|0

I now propose a short suspension of 10 minutes.

Before the next debate, I advise the Committee that we hope to get through clauses 21 to 24 and adjourn the sitting before we start consideration of part 2 of the Bill. I hope that is agreeable. We aim to end the session with clause 24, but we will see how it goes.

Clause 21

Duty of ORR to have regard to Secretary of State’s guidance

Question proposed, That the clause stand part of the Bill.

With this it will be convenient to discuss clause 22 stand part.

Clause 21 preserves the Secretary of State’s current ability to issue guidance to the Office of Rail and Road under the Railways Act 1993, and clause 22 does the same for Scottish Ministers. The clauses are necessary to maintain the ability of the Secretary of State and Scottish Ministers to issue guidance to the ORR when exercising relevant statutory functions, alongside the ORR’s duty to have regard to such guidance, which must of course be published to ensure that the safety regime that underpins the railway does not change.

Both clauses confirm that neither the Secretary of State nor Scottish Ministers can issue guidance to the ORR in relation to its functions as an enforcing authority under the Health and Safety at Work etc. Act 1974. This is to ensure that the safety regime remains completely independent of Ministers. In addition, guidance cannot be issued to the ORR when it carries out functions relating to train driver licensing, or its functions under the Competition Act 1998 to main consistency in the arrangements for competition regulation between the ORR and the Competition and Markets Authority. That will also provide further protection for the private sector.

The guidance issued under the clauses is intended, as is currently the case, to support the ORR in discharging its relevant statutory functions. Guidance can provide for a better common understanding of an area or encourage a strategic focus on specific issues, whether that relates to supporting freight growth, driving efficiency or improving passenger experience. Furthermore, the ORR will be afforded the flexibility to balance any issued guidance against its wider statutory duties and requirements.

The ORR confirmed at the Transport Committee that it can balance receiving ministerial guidance with its role as an independent regulator, and that it does so effectively already. Therefore, the clauses will help to ensure that the ORR’s regulatory role remains aligned with the strategic priorities set by the Government in a manner that is practical, proportionate and does not undermine the ORR’s independence as a regulator. I commend the clauses to the Committee.

The principle the Government continue to establish is important for the relationship between the state and the ORR when it comes to safety-related duties. I recognise the Government’s work to ensure that the clauses protect the ORR’s independence in many regards, rather than encroaching upon it. The protection of that independence is vital. When it comes to the relationship between Great British Railways, the ORR, the Department for Transport and Ministers, as well as the various devolved Governments and mayoralties —not forgetting the fact that passengers count—the Opposition have thought long and hard about how we can ensure that the ORR maintains its standards of excellence as a regulator.

I want to take this opportunity to review the safety record of the railways overseen by ORR as the safety regulator since its inception in 2004. The ORR publishes masses and reams of data as part of its continuing mission to provide transparency and oversight. By most key metrics, safety has improved significantly, with the UK being praised as one of the safest railways, if not the safest railway, in Europe. We really should stop and consider that achievement, whether it relates to nationalised or privatised parts of the industry. Government Members criticise privatisation, but it has not impinged on safety, and that is quite an achievement. It is vital that the ORR can continue its strong work in delivering not only a safe railway but a transparent one.

The ORR has consistently worked by acting as a critical friend to the franchise operators and Network Rail. In the new age of GBR, it is important that the Secretary of State, who will direct both the ORR and GBR, should be mindful not to create an environment in which the ORR feels it cannot be critical of GBR and its actions. Committee members will struggle to find many sectors where stakeholders praise their regulator, but it is right that Ministers should get out of the way of the work of the ORR, because its oversight work is the difference between life or death. I acknowledge that that is the Minister’s intention in clause 21.

Clause 22 sets out the duty of the ORR to have regard to Scottish Ministers’ guidance, and clause 22 mirrors that, enabling Scottish Ministers to give guidance except on the safety-related issues I have mentioned. I have a query about clause 22—I am not leading up to some devastating amendment—in respect of the dispute resolution process, if one exists, between the Secretary of State and Scottish Ministers.

Under clause 21, the Secretary of State must consult Welsh Ministers—that creates a clear direction for the conversation—but there does not appear to be an equivalent provision in clause 22. I would be grateful if the Minister could clarify that seeming contradiction and expand further on what happens in a situation where the guidance issued by the Scottish Minister contradicts that issued by the Secretary of State, or perhaps the other way round. Would that be covered by the memorandum of understanding, which of course we have not yet seen? Or is a tightening of statute on the horizon that we are not yet aware of? The Minister might not be able to whip an answer out of his back pocket, but perhaps he can clarify that issue once he has consulted his officials.

Naturally, Scotland has had oversight of Network Rail for many years, so the working relationship between the ORR and GBR north of the border is not likely to change, but, similarly to my concerns about clause 21, protecting the ORR’s independence is important to the entire smooth functioning of the railways. I know the Minister would not wish to speak for Scottish Ministers, but I would very much appreciate it if he could outline the dispute resolution mechanism between the Secretary of State and devolved Ministers. The Minister will be delighted to hear that, beyond that query, we do not oppose clause 22.

I thank the shadow Minister for his comments about the safety regime on our railways, and join him in the sentiment he expressed about the ORR. The Committee can argue about the merits of privatisation versus nationalisation, but the fact remains that the people who work across our railways do so with safety first and foremost in their considerations. The shadow Minister is absolutely right to recognise that we have a formidable safety record in the United Kingdom because of the hard work of people across the railway network.

With regard to situations in which UK and Scottish Ministers could give potentially contradictory directions to GBR, the Bill explicitly provides for the MOU to make provision about the use of directions powers, and the intention is to use that to agree how those powers will be used to avoid giving GBR contradictory directions. We have discussed that with Scottish Government colleagues. If the shadow Minister requires further information on that point, I will be happy to provide it for him. In the meantime, I am glad that he sees the sense in the clauses, and I commend them to the Committee .

Clause 23

Memorandum of understanding: Secretary of State and Scottish Ministers

I beg to move amendment 39, in clause 23, page 13, line 9, at end insert—

“(3) The memorandum of understanding must be published at the same time as the Rail Strategy.

(4) The memorandum of understanding must be laid before both Houses of Parliament for a period of two months before it can come into force.”

With this it will be convenient to discuss clause stand part.

I do not know why I bothered going to the gym this morning, Mrs Hobhouse, because I have been doing squat thrusts every time I rise to speak to a new group of amendments.

Clause 23 deals with the memorandum of understanding, about which we have heard so much but know so little, and the relationship between the Secretary of State and Scottish Ministers. It sets out the key arrangements between the UK Government and the Scottish Government, stating the intention for the memorandum of understanding to include steps to facilitate the integration of GBR infrastructure and Scottish railway services. The elephant in the room is that is none of that is set out in the Bill. The Opposition believe it is vital for Ministers to outline, at the very least, the broad framework for the basis of the memorandum if they will not commit to provide core elements in the Bill itself.

It really is very frustrating: we are paid to come to this Committee to give the Bill line-by-line consideration, set up the function of GBR and improve the relationship among Ministers in Whitehall, Edinburgh and Cardiff, the ORR and the other organisations affected by GBR, yet time and again we get the blank answer, “Oh well, this is going to be sorted out somewhere else.” It is very hard to say with confidence that we have scrutinised the Bill and come to an improved outcome when the Government have not done the work on the detail. This is not the first time Members have heard me say that—

It won’t be the last!

I hope it will be the last, but I fear I will not be.

I have some key questions for the Minister. I understand that the memorandum of understanding has not yet been finalised; has the work to scope it out even begun? The Minister should at least be able to answer that. At what stage in the deliberations between the two Ministries has it got to? What is the timeline for a memorandum of understanding under the clause being finalised and therefore made public? How often, if at all, must the memorandum of understanding be reviewed, updated or renegotiated? Or is it a one-stop shop?

It currently seems that the memorandums will have no statutory force. Unless I have missed something in the Bill—I always enjoy being corrected when I have missed something—it is not in there at the moment. Is that by design? What legal standing will the memorandums have? They do not appear to have statutory force, and there is very little democratic accountability, as I have mentioned. As far as I can see, the memorandum is essentially a handshake agreement. Not a single member of this Committee is any the wiser about what will be part of the memorandums.

Finally, what happens if no agreement is reached on a memorandum of understanding between the Secretary of State and Scottish Ministers? The Minister can give evidence about his willingness to reach agreement, but he cannot give evidence on the part of Scottish Ministers. They can be willing to negotiate, but he cannot say with confidence that they will achieve full agreement until such time as that agreement is reached. I stand to be informed by the Minister, but my current understanding is that that agreement has not yet been reached.

The lack of oversight is clearly at the core of this issue. Parliament is expected to allow the Secretary of State and her Scottish counterpart to set the tone of the nature of rail operations without any say from this House, beyond this clause. The Government criticise the franchise system, but at least the parameters for its operation were clearly set out. Memorandums of understanding are nothing more than IOUs to the trust of parliamentarians, and we should not willingly give those out.

There is a further issue at stake here: the Scottish parliamentary elections. This is a matter of practicalities, as opposed to principles. The pre-election period, or purdah, is rapidly approaching for the Scottish Parliament. My understanding is that it will be coming into force in late March, which is only weeks away. Given that the Minister will be eager to ensure that all the appropriate orders and memorandums are in place as quickly as is reasonably possible, what thought has he given to avoiding a rush job ahead of the election, or to the timetable for the memorandums of understanding being reached with any change of Government in Scotland? This is actually quite a significant question. Is the Minister going to rush it through to get it in before March? What happens if there is a change of Administration north of the border?

It is with that uncertainty in mind that we believe the clause ought to have a clear timeframe for the publication of the MOU. The memorandums of understanding should be laid before Parliament for approval. Parliament is being asked to give broad Executive powers as if an international treaty were being negotiated, but this is not an international treaty. Parliament ought to have the right to approve the memorandums to ensure, in particular, that Members whose constituencies are affected by them have a say on behalf of their constituents. That is what amendment 39 would provide, by providing two additions: that a memorandum be published at the same time as the rail strategy, which would give a concrete timeframe for the delivery of that important document, and that it be laid before Parliament for a period of two months before it can come into force. I look forward to the Government’s response.

I will endeavour not to detain the Committee for long. In the Committee’s second sitting, when Mr Reeve and Mr McDonald gave evidence—as I think my hon. Friend the Member for Broadland and Fakenham alluded to—Mr McDonald stated:

“In the case of Wales, the heads of terms for the MOU were published in December…We are optimistic that we can jointly publish a full draft in early March.”––[Official Report, Railways Public Bill Committee, 20 January 2026; c. 56, Q104.]

That is encouraging in the case of Wales, but Mr Reeve was unable to offer any similar assurance as to where things were with Scotland. He said:

“We are working with colleagues in DFT on the heads of terms for that and on what the principles will be”.––[Official Report, Railways Public Bill Committee, 20 January 2026; c. 55, Q100.]

He also said it remains a priority.

A different pace appears to be being reached in Wales compared with where we are with the MOU with the Scottish Government. My hon. Friend the Member for Broadland and Fakenham is right to highlight the fact that in both cases we will, in a few short weeks’ time, be entering the pre-election period for the Scottish Parliament and the Senedd. In the case of Wales, there is a degree of reassurance. Will the Minister update the Committee on where the discussions with the Scottish Government have got to; when the DFT and Scottish Government will publish the heads of terms, as the Welsh Government published them in December; and whether he is still convinced that the March timescale will be met and that we will see both MOUs published?

Amendment 39, tabled by my hon. Friend the Member for Broadland and Fakenham, is pragmatic and proportionate. It simply seeks to put a degree of certainty around the timescales and, quite rightly, as he highlighted, to give the process a degree of transparency by gently nudging all Administrations concerned to lay the MOUs before the House so that right hon. and hon. Members can consider them. I look forward to hearing from the Minister.

Before I speak to amendment 39, I will respond to the questions about the timings of the MOUs, but may I bring the Committee’s attention to the fact that, by reaching this clause, we are now one quarter of the way through the Bill? [Hon. Members: “Hear, hear!”] The hard work progresses.

Work has begun on negotiating the MOUs with Welsh and Scottish colleagues. The MOUs are subject to negotiation with the two Governments, but as the right hon. Member for Melton and Syston pointed out, the heads of terms for the Welsh MOU have been published. It is our intention to publish the Scottish MOU as soon as possible.

The hon. Member for Broadland and Fakenham imagined a nightmare scenario in which we are not able to publish the heads of terms because we do not reach an agreement. Both the testimony we heard at the Transport Committee and what Scottish Ministers, including Fiona Hyslop, have had to say suggest that the negotiations are progressing, as are deliberations on the Bill overall.

The hon. Gentleman was right to ask what the pre-election period means for the publication of the MOUs. I refer him to the noble Lord Hendy’s testimony on publication to the Transport Committee, in which he essentially conveyed the message that we are cognisant of the fact that that period is approaching and that we are working on the development of the MOUs on that basis.

I want to tempt the Minister. I hope he will look at me and not catch the eyes of his officials, because I am very well aware, from my time as a Minister, of phrases such as “in the fullness of time”, “at the appropriate juncture” and “in due course”, and exactly what they mean, not least as a keen student of “Yes Minister”. I am sure that, on occasions, I used them myself. May I tempt him a little further as to whether he is going to put an actual timescale on this?

As tempting as the right hon. Member’s requests are, if he would like me to use another phrase, I will say: as soon as possible. I say to the shadow Minister that, although he has to keep asking me about publication of the MOUs today, he may not have cause to do so in the future. That is something we are working to progress as quickly as possible.

The shadow Minister is right to point out—this is an important point—that the MOU itself is not legally binding or enforceable; it does not create new legal powers or obligations beyond those in the Bill. However, its preparation and publication are a statutory requirement; both parties are legally required to produce and publish it. That ensures the transparency and public accountability piece of the puzzle. The MOU is being designed to set out practical arrangements for co-operation between the Secretary of State and Scottish Ministers to provide clarity on governance, track and train integration arrangements, and accountability, without altering statutory responsibilities.

Amendment 39 would require the memorandum of understanding with the Scottish Government to be published alongside the long-term rail strategy and laid in Parliament. Unfortunately, it is our view that that would serve to undermine the effectiveness of the MOU, which is intended as a flexible mechanism for inter-governmental co-operation, setting out principles and objectives jointly agreed between Ministers. Requiring it to be published at the same time as the long-term rail strategy would unnecessarily lock both Governments into the same rigid timeline for two unrelated documents that serve different purposes. The long-term rail strategy sets out long-term priorities for the network, while the MOU is designed to support intergovernmental co-operation. There is no rationale for linking them.

Further, clause 23 already requires that the MOU be published, providing a meaningful process of transparency without the unnecessary delay that the two-month review period would introduce. Amendment 39 would therefore be counterproductive, and I urge the shadow Minister to withdraw it.

Clause 23 provides a sensible legislative basis for the MOU to ensure that appropriate collaboration and accountability mechanisms are in place between the two Governments. That statutory commitment to the MOU enables the Secretary of State and Scottish Ministers to ensure that decisions on Scotland’s railways are taken in a way that reflects Scottish and UK transport priorities. The MOU also enables a route for joining track and train in Scotland, which will ensure that Scotland is able to benefit from these reforms to the same degree as the rest of Great Britain while preserving the devolution settlement. As the Committee will be aware, there is full support from Scotland for the Bill. I commend the clause to the Committee.

I am interested to hear the Minister’s strong hints that the memorandum of understanding may be much more advanced than we had previously been led to believe. The intention of amendment 39 was to flush out the MOU—it sounds like it may well have already achieved its purpose. Taking the Minister’s words at face value, I beg to ask leave to withdraw the amendment.

Clause 24

Memorandum of understanding: Secretary of State and Welsh Ministers

I beg to move amendment 169, in clause 24, page 13, line 29, at end insert—

“(da) contain provision about the use to be made of the power to give directions under section 7,”.

With this it will be convenient to discuss the following:

Amendment 40, in clause 24, page 13, line 31, at end insert—

“(3) The memorandum of understanding must include details of the allocation of ticket sales from cross border routes that are operated by Transport for Wales.

(4) The memorandum of understanding must be published at the same time as the Rail Strategy.

(5) The memorandum of understanding must be laid before both Houses of Parliament for a period of two months before it can come into force.”

Clause stand part.

We have already discussed amendments 166 to 168, which provide clarity on the situations in which the Secretary of State must obtain the consent of the devolved Governments when issuing directions or guidance to GBR. Amendment 169 will provide the opportunity for further clarity by encouraging the Secretary of State and Welsh Ministers to address how the power of direction and consent requirement will be used within the terms of the memorandum of understanding. That mirrors the provision in clause 23 for the MOU between the Secretary of State and Scottish Ministers. The amendment is a sensible mechanism to ensure that the Secretary of State and Welsh Ministers will work together to hold GBR to account against their own priorities within a stable and co-operative framework that supports the operation of the whole system. I commend it to the Committee.

Clause 24 provides the legislative basis for the MOU with the Welsh Government. Just as clause 23 does for Scotland, clause 24 requires the preparation and publication of the MOU and states some of the areas that it may cover. The areas the MOU may cover for each devolved Government are different to reflect their distinct devolution arrangements. For example, clause 24 explains that the MOU for Wales may contain joint objectives for the railway within the Wales and borders area. That creates a practical mechanism to drive co-operation and to set out the detail of how the railway will be run. It will encourage both Governments to carry out their functions in a joined-up way, while ensuring appropriate accountability and transparency. In turn, that will drive better outcomes for passengers on both sides of the border. I commend the clause to the Committee.

The Government amendment makes further provision concerning the memorandum of understanding between the Secretary of State and Welsh Ministers. I have no objection to it.

The Minister is absolutely right that clause 24 is similar in intention to clause 23, but there are huge questions about the role that Welsh Ministers are to have in the governance and management of GBR in their jurisdiction under the memorandum of understanding, and whether the Secretary of State will have any role in the governance and management of Transport for Wales. The Welsh settlement is very different from the Scottish one, in both geography and degree of devolution— I suppose that is how it can be most simply described.

The relationship between the Welsh and UK Governments is far more nuanced and complex than the relationship in the case of ScotRail and the management of rail in Scotland. Transport for Wales covers a significant number of cross-border rail services. I stand to be corrected, but I think that as many as 80% of all its services have an element of cross-border movement. This harks back to the former private sector franchise of Arriva Trains Wales, which ran many England-only services and joint England-Wales services. That system of rail service provision persists under Transport for Wales; it is much more blended than is the case in Scotland.

I have some examples. Shrewsbury station, which, for the geographically challenged, is in England, is managed by Transport for Wales. From there, it manages services that run exclusively in England, such as Shrewsbury to Manchester. It also runs all manner of cross-border services, such as the Heart of Wales line, of which about 5% is in England, and Aberystwyth to Birmingham, which is 50:50 England and Wales—on it goes. Any memorandum of understanding will have to outline in detail, one assumes, how the allocation of moneys for tickets will be divided.

This works both ways. Former Great Western Railway and Avanti services from London to Holyhead and from London to Swansea via Cardiff have significant portions of their routes running through Wales as well as England. Taxpayers in both nations will rightly presume that the value of ticket sales will be distributed proportionately between both railways, as they will both be Government-run, rather than going to the operator whose livery happens to adorn the locomotive. The issue is relatively small in the discussions about Scotland, where I think only 3% of services are cross-border between England and Scotland. In Wales, the proportion is much greater, and I am concerned that there is no clear mechanism for how the allocation of ticket sales is set to be achieved or agreed.

Will GBR and Transport for Wales—or, more accurately, the Secretary of State and the Welsh Ministers—come to a profit-sharing or fare-box sharing agreement as part of the memorandum of understanding? This is at the core of the issue of value for money, so it should be an important consideration, and I look to the Minister to provide reassurance that it is in the mix.

I have a compounding concern, which I expressed in relation to clause 23, about the timeline of the publication of the memorandum of understanding. Again, a purdah period is approaching: the elections for the Welsh Senedd are in May. I think I am right in saying—my right hon. Friend the Member for Melton and Syston mentioned it—that it was suggested in the oral evidence that the heads of terms have already been agreed, but that is not the same as the memorandum of understanding being agreed, so we need a bit more detail from the Minister, if he is able to give it.

There is a big caveat for Wales in particular, where—though I do not want to ruin anyone’s sleep tonight—it is very likely that Labour will be removed from office come May, and that there will be a new Government in Cardiff. It would be improper for a rush job to take place in order to shoehorn through a memorandum of understanding between two like-minded Administrations.

I have tabled amendment 40 to clause 24 for the same reason that I tabled amendment 39 to clause 23. Amendment 40 seeks to introduce a degree of control over the timeline for the publication of the memorandum of understanding. In the Transport Committee evidence session on 17 December, Peter McDonald, who is the director for transport, spoke on behalf of the Welsh Government. He spoke in some detail about the future relationship between GBR and the Welsh Government, and how it relies on the memorandum of understanding. Will the Minister take this opportunity to reassure the Committee about the safeguards or timeline the Government have in place? Do they believe it would be helpful to have a clearer timeline, especially considering the electoral sensitivities and, if the opinion polls are to be believed, the likely change of Administration in Cardiff Bay?

I have plenty more to say about this, but I am aware that it is getting dark outside and we have been going on for some time. Those concerns are the rationale for amendment 40, which would apply similar requirements to those that amendment 39 would have applied to clause 23. I tried to be understanding with the Minister in not pressing amendment 39 on Scotland to a vote, because of the direction he was able to hint at in his response. I look forward to being similarly reassured in respect of Wales.

On the shadow Minister’s point about profit sharing, the MOU is designed to set out the operational arrangement between GBR and Welsh services. In that respect, the MOU will not affect the existing profit-sharing arrangement between the Governments for cross-border services.

The shadow Minister also asked me for a little more information on how the MOU will affect cross-border services between England and Wales. The clause allows the MOU to identify services in England that the Secretary of State and Welsh Ministers would like to be provided alongside Welsh-designated services. It lets UK and Welsh Ministers set objectives for integration and steps to facilitate it, as well as the arrangements for sharing information. That will hopefully provide a clear framework for co-ordinating cross-border operations, enhancing efficiency and passenger experience, and supporting seamless connectivity across the Wales and borders area.

The shadow Minister’s amendment 40 would require the Welsh MOU to be published at the same time as the long-term rail strategy, and to be laid in Parliament for two months before coming into force. I refer the Committee to my previous comments. The MOU serves a different purpose from the LTRS, and linking them would add unnecessary complexity for little apparent gain.

I understand the point the Minister is making about the lack of relationship between those two documents. In the debate on the previous group, he was able to give an indication of the likely timeframe for publishing the Scottish memorandum of understanding. Can he give a similar hint on the Welsh memorandum of understanding? [Interruption.] There seems to be a bit of nodding on the Government Benches, but it is entirely up to him, because he decides.

As Lord Hendy was fulsome in explaining, those involved in negotiations for the MOU are extremely cognisant of upcoming election dates in Holyrood, and I would say that they are similarly cognisant of upcoming election dates in the Senedd. I hope that provides the shadow Minister with the indication that he may need.

Returning to amendment 40, the MOU with Wales has the same publication requirement as the MOU with Scotland, meaning that transparency is already baked in without the need for a two-month review period. As the shadow Minister set out, the amendment would specifically require the MOU to include details of the allocation of ticket revenue from cross-border routes. That would add unnecessary complexity by effectively embedding granular, technical review formulas into a document designed to set out a strategic agreement between Governments. This detail is an operational and commercial matter rightly governed by established industry settlement mechanisms and bilateral contracts.

The Bill already provides a statutory framework for fare setting and transparency, enabling GBR to set fares for its services while devolved operators manage their own. Including these details in the MOU would duplicate existing processes and could conflict with the Bill’s intent. I therefore urge the shadow Minister not to move the amendment and commend the clause to the Committee.

Having heard the semi-reassurance of the Minister, I will not move amendment 40.

Ordered, That further consideration be now adjourned. —(Nesil Caliskan.)

Written evidence reported to the House

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