Railways (Interoperability) (Amendment) (EU Exit) Regulations 2019

Motion to Regret

Moved by

That this House regrets that the Railways (Inter- operability) (Amendment) (EU Exit) Regulations 2019 (SI 2019/345), laid before the House on 26 February, will cost United Kingdom businesses excessively in operating a potentially diverging range of safety and other railway standards from those of the United Kingdom’s largest market, and regrets the failure of Her Majesty’s Government to demonstrate any significant benefits; and calls on Her Majesty’s Government to lay new regulations that would enable continued compliance with the activities of the European Agency for Rail to provide the best ongoing business opportunities for manufacturers, rail passengers and freight customers in the United Kingdom; continued and consistent safety improvements; and reduced manufacturing costs as a result of one common set of standards across Europe.

My Lords, the previous two SIs that we debated caused a lot of interest—I am grateful to so many noble Lords for their contributions—but they are to some extent the hors d’oeuvre, because this one is the main course. I wanted to table it as a fatal Motion because I feel so strongly about it, but the timing does not really help and I was told it might be several weeks before parliamentary time was found, which would be after the Brexit date that we had—I do not know whether we still do; that is for discussion.

This is a really serious problem: transferring all responsibility for railway safety and standards from the European railway agency to the Secretary of State in the event of a no-deal Brexit. It is very complex, as noble Lords said earlier, but in this case it is also unnecessary: there is a much simpler solution. My impression is that the reason that so many of these pieces of railway legislation, and those on air travel, are presented as a major change is because somebody in government does not like the word “Europe” in the title. We debated this last week when we were discussing the noise regulations in respect of airports, and I suggested to the Minister that there was a serious conflict of interest here, because if the Secretary of State—I am not being personal: any Secretary of State—is responsible for noise regulation at airports but is also pushing for all he or she is worth the third runway at Heathrow, it is in the Secretary of State’s interest that the noise regulations are as lax as possible. The lack of consultation was discussed then, and I fear the same is happening here.

There is a solution, which I shall come to. The European railway agency goes back a long time: I have been involved in it for probably more than 10 years. It means that there is one set of standards for the manufacture, export, testing and everything in the railway sector across Europe. There is the common requirement for safety, accident and other data, which the House also discussed this morning. It is extraordinary that the Government are introducing this massive change for what I call dogmatic reasons.

My Lords, I endorse everything my noble friend said. This SI represents a significant change, not just in our relationship with Europe, but as far as our industrial potential is concerned.

For too long, this country has given away to, or allowed takeovers of its major industrial production by, foreign Governments. At the time of nationalisation, back in 1948, there were more than 150 railway workshops in this country. Those of us of a certain age are familiar with seeing that “Made in Britain” sign in railway industries in other parts of the world—for example, on locomotives, rolling stock and signalling systems. I was in Hong Kong in the 1970s. The new rapid transit system there depended on the expertise of GEC Alsthom, which built the first trains for that system in Birmingham. Yet we have thrown away all that expertise and allowed foreign companies to take over our industrial production.

This SI will make matters worse. If we are to have different standards from EU—that will happen over the years—the ever-smaller market of the United Kingdom will continue to shrink. Even as we speak, the signalling systems in Europe are being unified. The French and German Governments have just refused—temporarily, I suspect—the amalgamation of two major signalling production companies to create, in effect, a European monopoly on signalling. Again, if this SI goes through, our prospects of competing in these areas will be diminished. That is what it means.

We are moving away from the European railway agency—the ERA—and placing these decisions in the hands of the Department for Transport and the Secretary of State. The Minister will be relieved to know that I will not indulge in any knockabout about the current Secretary of State; after all, even with his powers of survival, I cannot see him being in the department much longer. We are moving away from European standards and allowing him, or some other Secretary of State, to decide standards for rolling stock and railway materials more generally in this country. That is what we are doing. That is how significant this SI is.

My Lords, I support my noble friends Lord Berkeley and Lord Snape in their opposition to this measure and add my regrets that we are not pursuing a fatal Motion on this issue. My interest in this is personal. I am a railway clerk’s son from Carlisle and I have always been passionate about the railways. My first job in national politics was as special adviser to the noble Lord, Lord Rodgers of Quarry Bank, when he was Secretary of State for Transport, so I have a personal connection. Also, I happened to learn quite a lot about the detail of this SI from being a member of your Lordships’ EU Sub-Committee on the Internal Market, chaired so wonderfully by my noble friend Lord Whitty. The Secretary of State appeared as a witness before us on these questions and it was absolutely plain that the reason he wanted to withdraw from the European agency was nothing more than ideology. He could not stand the fact that standards would be set by Europe. That is what we face all the time from Ministers in this Government. There is no pragmatism about Brexit, so why do noble Lords think we are in trouble? It is because of that absolute absence of any pragmatism.

When we had that hour-long disquisition by the Secretary of State, I raised the issue of the manufacturing plants, which, as my noble friend Lord Snape said, are now foreign-owned but based in Britain. My noble friend Lord Adonis is not in his place but I know that a remarkable achievement of his—one of many, by the way—when he was Secretary of State for Transport was to get Hitachi to establish a plant in Durham that would manufacture trains.

I hate to interrupt my noble friend in full flow, but may I point out to him that that plant in Durham is not a manufacturing plant, it is an assembly plant? That is the great weakness of British industry these days. We put together materials and trains that are built elsewhere. That is what we are going to do in Durham.

I quite accept the point made by my noble friend but it is better than nothing and it provides hundreds of jobs in Durham. While my noble friend says it is just an assembly plant, how could such a plant operate in Britain if we decided to have different technical standards from those on the continent? That would completely destroy the business model on which that inward investment had been made.

I am grateful to my noble friend for his words. Is he aware that Hitachi recently bought a firm in Italy that manufactures trains and signalling equipment? Can he imagine what would happen if it had to manufacture in all these places using different standards for the European markets and the UK?

As always, my noble friend Lord Berkeley makes an excellent point. I think that the Government have to come up with a better explanation for why we should be leaving these arrangements than the simple, “Why should we bother to be part of some European agency when we have left the European Union?”

My Lords, I rise to speak with some trepidation. I am not as expert in these matters as the noble Lords, Lord Berkeley, Lord Snape and Lord Liddle. However, I share their concerns about what the Government are doing by extricating us from years of integration in Europe in important areas of our national life. This is a perfect example of the dangers of the obsessive ideology which seems to believe that we must leave the European agencies which we helped to establish. Leaving them will impose much greater costs on our country, much more regulation rather than less, and indeed doing so will probably take us back around 10 years in the progress we have made across Europe in these vital areas of our national life.

I support fully the call by the noble Lord, Lord Berkeley, for us to remain at least an associate member of the European rail agency as well as the signalling agency. The transfer of responsibility from these agencies, which have enormous expertise and experience, to the Secretary of State fills one with some trepidation, to put it mildly. It may be that my noble friend the Minister, who I am sure shares some of my concerns even though she is in a difficult position, can provide some assurances that the Government will consider alternative plans that allow us to remain part of these agencies whether or not we leave the EU with a deal. Obviously, I hope that we have no chance of leaving with no deal, but so far the Government have refused to consider the idea of revocation if that is the only way to avoid it.

We need to continue the important activities of compliance and information sharing that are a part of these agencies. Just because there is some link to the ECJ, for example, is not a good enough reason to leave agencies that are so important to many areas of our national way of life, prosperity, security and safety. I urge my noble friend to respond positively with some of the assurances that the noble Lord is seeking.

My Lords, I start by thanking the noble Lord, Lord Berkeley, for bringing forward this Motion, and state that had he had chosen to table a fatal Motion, I would have supported him all the way. It is a supreme irony that Britain, the country that brought the railways to the world, is now insulating itself from world progress on the technology.

As we work through these SIs, they produce a range of solutions to the problems that the transport sector faces. Some of the solutions are relatively neat, while others are pretty clumsy. Then there is this one, which is simply downright stupid. That stupidity has been recognised by all the key railway industry organisations, which are seriously worried about the future. I also draw attention to the fact that the SLSC sub-committee which looked at this SI has expressed its view that an important policy issue is being raised here.

Interoperability means the application of EU-wide technical and operational standards. That applies to the rail infrastructure, the vehicles and the component parts. It is based on technical specifications, known as TSIs, devised by the European rail agency. It is important to note that the UK is very well represented at that agency by its technical experts. We have been a leading member and we have a vote, which of course we are going to give up. TSIs automatically apply to the UK, so we have not had to create our own regulations, but that does not stop us creating our own additional standards. These are proposed by the Rail Industry Safety and Standards Board.

There are a number of key issues about this SI. It is made under powers in the Transport Act 2000, and so would normally be done by the negative procedure. As all of this is very controversial, as I shall set out later, I am concerned that future SIs on this subject should be passed by the affirmative procedure. Can the Minister give us that reassurance today?

These regulations require,

“rail vehicles first authorised in the EU to undergo … additional authorisation for use in the UK”.

The impact assessment says that this,

“is not expected to impose an additional cost or administrative burden on rail operators”.