The Tories left you with a slightly muddled legacy with the railways. How do you think you’ve coped in dealing with that?
I don’t want to sound complacent but I do think we’re in a better place than we would have ever have imagined at the time of privatisation. We’ve got demand going up at a record level, we’ve got the youngest railway carriage fleet in Europe, we’ve got record level of investment. It’s not all rosy but it as good a picture as we could have hoped for if you look back to the mid 1990s.
How have you achieved that?
Investment is a big part of it. I am very conscious of the fact that previous governments, both Labour and Conservative, have rightly been accused of under-investing in the railways all throughout the nationalised period. We came to power and we recognised that the railways are an important part of the railway infrastructure and they deserved much higher levels of investment. That’s been a part of it but it is also the structure of the industry. I think the railways do better in the private sector. I don’t think that there would be anything to gain from going back to a nationalised model – I think what we have is an industry that is specified by the Government and provided by the private sector and I think that is working.
So you’ve accepted the Tory ethos?
No, the Tory ethos was to privatise because John Major wanted a flagship privatisation. It was the wrong reason to have a privatisation scheme. It was also done in the wrong context – done in the assumption that railway patronage was going to go down over the long term. We were all wrong in that. So I think it was done for the wrong reason and completely the wrong structure – and we paid the price for that.
Yes in terms of saying that we should have a private sector providing a particular service. I have no problem with that as long as the service provided is good enough.
But isn’t the structure the same as under the Tories?
The difference is that Railtrack was a private company with shareholders. Network Rail doesn’t have shareholders. I think people have more confidence in Network Rail because they’re not looking over their shoulders to pay premiums to private shareholders. You could argue that the structure is more complicated than it should be – I don’t think it is. But when it comes down to it, if you’re a rail user do you really care who owns the train – all you’re worried about is are you going to get you to your destination and can you afford the ticket. There is no doubt that the service today is better than under British Rail.
But that isn’t the case with First Great Western?
Which is why I did make some caveats. We don’t want to be complacent. There are trouble spots in the railway map of UK. and FGW has been one of the biggest problems. What’s happened in FGW is that they have admitted that they got it wrong. The level of service hasn’t been what it should be. I agree with them. We had to issue a remedial notice earlier this year as they were in breach of their franchise. However, under new management FGW have, as far as I can see, they have made some major improvements – but that’s got to be sustained.
I am less concerned about headline figures on the industry standard performance measure – than I am about members of the public perceiving an actual improvement – once that’s happened, I will be satisfied that first have kept to their promise.
So what went wrong at First Great Western?
Well what we’ve said in the remedial plan is that First had to employ new train drivers and they’re introducing new rolling stock for some key routes. Staff morale was a big problem and there were all sorts of problems with their maintenance depot, the one in Bristol and lots of problems with staff rotas such as people not turning up to work and high levels of sickness. It was general morale stuff that created a perfect storm around FGW but the new management seems to have recognise the problem and are taking the appropriate steps.
But what was the role of government? I went down to speak to a guy from the Severn Tunnel Action Group and he said that under the new timetable introduced in December 2006, the first five train in the morning were simply scrapped, despite their warnings about the use of these trains. He said that was in the specification and that it was down to the government, not FGW.
The minimum service specification sets out minimum legal requirement that train operators must provide. There is a debate – should the government specify minimum levels or should private rail companies be able to decide which routes to serve and whether they route is profitable. I don’t think we should go down that way. I think the government has a responsibility to specify a minimum level of service and if train companies who have that franchise want to offer services above and beyond that then they can take the profit/ risk in providing those services. On the FGW franchise there was unhappiness about the specification – and I understand why – in some areas the specification was lower than it had previously been
But the point here is that they just scrapped a whole bunch of trains. There was no train until 8 25am which was too late for people to get into Bristol for work.
I accept there were problems at Severn Tunnel junction – but First came forward and re-instated those trains. These companies do respond to public demand and public consultation. I accept that criticism can be levelled at the service specification on Great Western.
So the department under specified ?
I am saying that I accept that some of the criticism that has been made , I understand why it has been made.
So did the department set targets that were too low?
Let’s get to the root of this. The problems that FGW have been experienced have nothing to do with the service level commitment, the minimum service specification. First have acknowledged that they’re responsible for the problems that have materialised in terms of rolling stock. There is the myth that has been peddled by rail users and some journalists saying that the Government actually instructed them to remove some carriages. Nonsense. what happened was that FGW came with the rolling stock plan and it was assumed to be deliverable.
But (showing the list) I’ve got the list here. it is set out in great detail in the franchise contract which is a public document and it is signed by the Department. It shows in great detail exactly what rolling stock is needed and where it should be used
That is the FGW rolling stock plan
So they came to you with that plan. You didn’t specify that plan which we now is unworkable?
You’re assuming that the rolling stock plan was the cause of all the problems. The reason the remedial plan was issued in February was because of the levels of cancellation, not the amount of rolling stock. If you have cancellations then there will be far more overcrowding on the next service, and if that is late as a result then there is a knock on effect. If you have train crew not turning up, if you’ve got low morale, if you’ve got under-staffing then that is going to create just as much problem in terms of overcrowding as not having enough rolling stock.
But on the Cardiff – Portsmouth route, the trains went down from three to two carriages. Why did you let that happen?
The plan seemed deliverable at the time. You could argue that there should be more trains but you could argue that there should be more carriages for every franchise. The problem throughout the country is that the predicted availability of free rolling stock never happened because patronage went up so much. So there is a dearth of rolling stock which is why we are committed to procuring 1,300 new carriages in the next five to six years.
But if it had simply been rolling stock shortages that was the problem, we wouldn’t have seen the level of problems that we did and that’s why when we issued the remedial plan. It was sparked by the level of cancellation not the lack of rolling stock
So it was down to poor management?
Yes it was down to poor management and from what I can see the new managing director, Andrew Haines, has been doing some very radical stuff to bring it back on line. There does seem to some improvement. However I am not going to second guess that We will have to keep a close eye on it.
One of the complaints is that travel on FGW is very expensive. Under the White Paper issued last year, there is a clear move to increase fares above the level of inflation which will make fares even more expensive. Do you think that’s sustainable?
Yes but let me clarify what it says in the White Paper. what we’ve committed to doing in the next control period, which runs between 2009 and 2014, is that we will continue to have fares regulation. Un regulated fares are unregulated, by definition. There is an accusation that the operators use unregulated fares to price people off the railways. If that is their intention then they’re failing miserably. They have a vested interest in selling those tickets so I don’t accept that unregulated tickets are too high.
There is also the argument that government should regulate all fares. As a minister I don’t think that the money we have available to invest would be best placed in subsidising fares that are business or first class. I think that the money is better invested in what we’re actually doing, investing across all rail mainline routes.
But if you live in the Thames valley. Railways have a monopoly and people have to travel peak time and they don’t have much choice?
But if they have season tickets they are protected and regulated.
And regulated fares will go up by inflation plus one percent. The money for investment has to come from somewhere. I think that people who use the railways should pay something towards that, given that other taxpayers who don’t use the railways are also paying towards the railways
Do you agree with the aim which John Prescott expressed, which was ‘to get people off the roads and on to rail’?
No I don’t, not explicitly. If it happens then great. I am, to use that strange expression, modally agnostic. I think that people in this country choose to use the railways or choose to use their cars, and it is up to them. They are grown ups. They don’t want a minister telling them, lecturing them, preaching to them to use one transport over another. What I do want is fro people to be given a valid choice. II don’t think it’s up to ministers to start wagging their fingers
But you have a lot of tools at your disposal to influence people one way or the other: aviation tax fuel tax, subsidies for the railways?
But that’s about putting investment where it has to go to ensure people have a choice If people want to use short haul flights within the UK – then that’s entirely up to them
Even though the carbon footprint is disastrous ?
People need to be aware of their carbon footprint – and have to make a valid choice but I as a minister am not going to say to them you are morally wrong for using one from of transport over another – what I want them to say is if you want to use the railway over flying then we will make it a valid option
Do you envisage a time when there will be sufficient money available for investment to allow the Government to invest in a high speed line?
We already have one high speed line. If you’re asking me as an individual, then my guess is that yes we will have more high speed lines at some point in the future. Our spending commitments to 2014 don’t include building a high speed line. It is an expensive project. We don’t have the money to commit to it at the moment. I would like to see more work done on it. I am probably more optimistic and supportive of the concept of high speed railways than, for example, you are.
Do you at all consider the idea of renationalising the railways?
No, I wasn’t an MP then but my view is that if Labour had come into power in 97 and the railways had still been nationalised, then I think we would have privatised them. I don’t think it is particularly honest for a minister to say that the only reason that we’re not going to re-nationalise is because it would cost too much. Yes it would cost too much and passengers wouldn’t benefit from it but actually to say that is the only hurdle is simply not true.
So ideologically you’re committed to a private railway?
Ideologically, I think, practically speaking. The private railway has provided a level of investment, innovation, imagination that wouldn’t have happened if British Rail had stayed as it was. If you speak to suppliers – they are displaying a level of commitment and enthusiasm that you just wouldn’t have got under a nationalised industry. I don’t think that if BR had stayed as it was up until 94/ 95 – we wouldn’t have as good a service as we do have today.
Even on FGW?
FGW is the exception – but I am actually confident that in due course we will improve the service.