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Opposition Day

Volume 264: debated on Wednesday 18 October 1995

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[18TH ALLOTTED DAY]

Rail Privatisation

I have selected the amendment standing in the name of the Prime Minister.

3.44 pm

I beg to move,

That this House, bearing in mind that both the sale of the train franchises and the flotation of Railtrack are falling further and further behind schedule because of investor disinterest or distrust, and noting that the run-up to privatisation has revealed a lamentable decline in safety standards, an unprecedented collapse of investment and almost universal opposition from the travelling public, calls upon the Government to abandon this sell-off and switch expenditure from promoting the dogma of privatisation to improving a vital public service based on renewal of rolling-stock, upgrading of lines and higher standards for passengers.
I congratulate the Secretary of State for Transport, the new holder of the post. I hope that he enjoys his time in office for the brief tenure that is all that awaits him.

At the risk of intruding into private grief, I also wish the right hon. Gentleman well in his search for a new seat at Maidenhead, where, I understand, his deputy, the Minister for Railways and Roads, is the other main contender. I do not wish to spoil his chances by announcing that I am backing him. As, however, this is the first time in the current chicken run that two Ministers in the same Department have scurried for the same seat, all that I say is, "May the best chicken win!"

On 24 November last year, the previous Secretary of State for Transport announced that the Government intended to privatise Railtrack by April 1996—[HON. MEMBERS: "Hear, hear."] That is a little premature in view of what is coming. Almost a year later, so far has the proposed privatisation fallen into public disrepute and commercial suspicion that the present Secretary of State was obliged to reannounce it a week ago to the Tory party conference. This time, there were two important differences. First, he was forced to admit that the Government could not meet their target for the sale of 1 April next and that the aim now was for it to be some time in spring. As every single target in this whole sorry saga has been missed, normally by a wide margin, we can take that promise with a pinch of salt.

Secondly, the Secretary of State had to admit that the sale would comprise
"at least 51 per cent. of the assets."
That is a major climbdown. Hitherto, there had never been any doubt that the figure would be 100 per cent. Indeed, on 15 November last year, the Chancellor of the Exchequer wrote to the Prime Minister in one of those leaked letters saying that the privatisation of Railtrack was
"integral to the Budget arithmetic."
In other words, given that the whole aim of the exercise is to raise funds for tax cuts, it is clearly a humiliating admission that the Government may now be able to sell only half. It is the most obvious sign yet that the Government are in deep trouble over this privatisation, both with investors and with the travelling public.

It is scarcely surprising. Who in their right mind would want to buy into an industry that, uniquely and unlike any previous privatisation, will always be dependent on a high level of Government subsidy—£2 billion this year—which no Government, Tory or Labour, can automatically guarantee for ever? Who in their right mind would want to buy a piece of an industry split up into 94 separate parts, all independent and competing against each other, where the profitability of each part is unpredictably dependent on the condition and performance of all the other parts?

Who would want to buy into a train company when the revenue and profits will be squeezed by the fares cut which the Government have imposed, while the fixed costs are continually being forced up by Railtrack's ever-rising track access charges and when they know—I make this clear—that a Labour Government will not allow them to go for a quick profit by lowering any further the already too low passenger service requirements fixed by the franchise director?

Who would want to buy into Railtrack when 80 per cent, of its revenue comes from track access charges, and there can be no certainty about their future level? Current charges are based on valuing Railtrack at about £8 billion, under an accounting system known as modern equivalent assets valuation. However, if Railtrack is sold at a fraction of that value that must significantly reduce the track access charges that would be permitted by the regulator.

In the light of all that, it is hardly surprising that, when Sir Bob Reid, the former chairman of British Rail, and therefore someone who knows more about the subject than most, was asked about Railtrack's investment prospects, he said that he would rather put his money into a butcher's shop.

That also helps to explain why, despite all the huffing and puffing about privatisation that has gone on for a year, the Government have managed to sell only one quarry in Devon, an electronics firm, four British Rail maintenance workshops, two smaller workshops and two depots, together with the train charters to run services for special events. That is all they have achieved after a whole year of seeking to privatise the railways.

Far from meeting the timetable by selling half the network by 1 April 1996, the Government may now fail to have sold even one passenger franchise, and they will certainly not have sold more than a tiny handful by that date. The Secretary of State, carried along on a high of pre-privatisation complacency, appears not even to understand his own target. On 10 September he said:
"This month, 51 per cent. [of the franchises] will have had their service requirements defined. At the end of the year, about 51 per cent. of the franchises will be out to tender".
The right hon. Gentleman was not even right about that. By the end of last month only seven of the 25 franchises have had their service levels defined. But that is not the point. The real point, which the right hon. Gentleman seems unable or unwilling to grasp, is the fact that the Government's commitment was to sell 51 per cent. by turnover of the franchises by 1 April 1996. On that score they have comprehensively and ignominiously failed.

Far from going away, the problems are multiplying. We know from leaks—I am glad to say that so hated is rail privatisation that we have had plenty of those over the summer—that plans for Railtrack to produce new computer software for the May 1996 timetable, by which time it is supposed to be operating as a private company, are in a state of collapse.

The hon. Gentleman said that he was glad that there had been plenty of leaks. Are we to take that as an official statement from the Opposition Front Bench? Do Front-Bench spokesmen wish to encourage the release of confidential information? Is that the attitude of new Labour?

I understand the hon. Gentleman's anxiety on that score. Of course I am not encouraging leaks; I am simply a recipient of them, but they have been most revealing and I have no doubt—

The right hon. Gentleman should let me finish answering his hon. Friend.

I have no doubt that, until the Government give up their madcap privatisation, leaks will continue to flow.

The hon. Gentleman told the House that he did not encourage leaks. Is he aware that, in an article that he wrote for Railway Magazine, he said:

"leaked documents are particularly welcome. I promise to make good use of them."

Absolutely. Leaked documents are particularly welcome; I am not encouraging them, but if I—[Interruption.]

Since one of the terms of service for anybody now working in this highly responsible new organisation is that they must not disclose information of any kind—even that which clearly is in the public interest—is it not absolutely essential if passengers are to be safeguarded that railwaymen and women, far from being treated in a contemptible way and told that they are not trusted, tell the truth? Should they not have the right to pass on such information to the public?

My hon. Friend makes an extremely important point. The situation in the rail industry is exactly the same as that which is operated in the health service—employees who know that the interests of the public are being undermined or put at risk are forbidden to make that information known. That shows how ashamed the Government are of what is going on in the services for which they are responsible. It is an act of public duty for those people who know facts which are in the public interest to ensure that those facts are made known. There are so many of examples of that that the Opposition do not have to ask for them.

Does my hon. Friend agree that the road to socialism is strewn with photocopies and brown envelopes?

I certainly think that the road to retaining the rail industry within the public sector is strewn with a mountain of leaks. Those leaks indicate—and public polls confirm—that 88 per cent. of the population are deeply opposed to this privatisation. That number must include half the Tory party and, of course, many employees who know better than anyone what is going on.

I was talking about the computer software and the problems that the Government are having before I was temporarily interrupted. I received a letter from a senior Railtrack employee, dated 26 September, which stated:
"The present crisis is because the next May (1996) timetable needs to be on our systems within the next couple of months, but there is no chance of this happening. The next system simply will not be ready, if indeed it will ever be ready.
Of course Railtrack decided they needed to have all sorts of fancy line and time charging systems on the new software, things that were naturally totally unnecessary on the unified BR software, but that is a natural consequence of Rail Fragmentation.
If Railtrack were passed back to the BR board, all these problems would just disappear, and an awful lot of taxpayers money would instantly be saved as a result."
What a pity that the Secretary of State cannot rise above the dogmatism of his predecessor and, for once, show a bit of common sense.

Even that is not the end of the timetable farce. Railtrack produced a 2,100-page timetable for the current year which was so pitted with errors and misprints that two supplements of 300 pages of corrections were required. Even that was not enough, as I understand that trains were still apparently scheduled to collide on the route from Waterloo to Exeter. Railtrack decided to recall and pulp 100,000 existing timetables, which retailed at £7.50 each, and print another 100,000. But I understand from industry sources that further misprints and errors are likely, so we can expect more supplements. At this rate we will soon have more rewritten timetables than John Major relaunches—with, I must say, about the same degree of success.

It is not just the industry and investors who are bemused and bewildered. The travelling public are equally bilious. In his speech last week to the Tory party conference, the Secretary of State said that, no matter who ran the railway, there would be "no compromise on safety". Does he have the faintest idea what has been going on? I must pay tribute to my hon. Friend the Member for Fife, Central (Mr. McLeish) for his remarkable series of revelations during the summer.

Mr. Jack Rose—Railtrack's senior manager responsible for safety—warned two months ago that Railtrack needed 18 months if it was to manage safety effectively, yet the Secretary of State continues to insist on concluding privatisation within the next six months—a year before those systems can be in place.

Then there was the botched £2.5 million resignalling project on the Glasgow to Perth line, which led to signals showing green on 10 separate occasions when they should have been showing red, revealing that the lessons of Clapham, when 35 people were killed, had still not been learnt. It also revealed the dishonesty of Railtrack, which initially lied that passenger trains were not involved.

Now the safety and standards directorate within Railtrack is being sold off. The body responsible for safety policy throughout the network is being made subject to the commercial pressures of the private market.

We have a leaked report—one of the many that we have received—of internal Department of Transport correspondence, which shows the ultimate cynicism about investment in new and safer trains. I shall again quote that correspondence word for word. It states:
"Statistics show that the actual number of accidents occurring is small. This has been tolerable to customers and users of the railways so that the promise of better trains in the future has been an acceptable situation, and there is not generally a demand for the immediate renewal of older vehicles simply because they are less crashworthy than new vehicles."
If all that is what the Secretary of State means by no compromise on safety then God help our railways and the travelling public if the Conservatives win a fifth term.

Nor is this merely a matter of safety. Every other promise the Tories made about a privatised railway has gone sour. They said that it would produce a better service for passengers. The Secretary of State said that again this morning. In fact, the passenger service requirements have been consistently fixed at 15 to 20 per cent. below current timetable provisions. They said that it would be less costly for the taxpayer. In fact, the Tory-dominated Select Committee on Transport said a few months ago that it would cost £700 million more to run a private rather than a public railway.

The Tories said that privatisation would reduce bureaucracy. In fact, the increase in bureaucracy will be stifling. According to Railtrack' s legal advisers, for every station used by more than one of the 25 train companies, there will have to be a 42-page lease and a 196-page station access conditions document plus, for every user, a 26-page collateral contract and a 31-page station access agreement. All the documents have to be customised and there are 2,500 stations. Indeed, the hideous complexities of this crackpot privatisation structure are mainly responsible for the continually missed deadlines and abandoned targets.

The previous Secretary of State, in his statement on Railtrack last year, said that privatisation would allow for
"delivering efficient track maintenance and encouraging investment in the upgrading of railway lines. It will provide even greater scope for private capital to be injected into better facilities."—[Official Report, 24 November 1994; Vol.250, c. 729.]
What exactly happened? Since privatisation was announced in 1992, investment in the network has halved in real terms. Track maintenance has been cut so that, according to the Department's written answer on 17 July in column 887 of Hansard, on one line alone—the Paddington to Plymouth line—no fewer than 16 speed restrictions are in force because of the condition of the track. According to the excellent Select Committee on Transport report of 5 July, about 195 miles of track are now subject to speed restrictions.

What about the previous Secretary of State's statement about the greater scope for private capital to be injected into better facilities? In fact, privatisation has generated the biggest dearth of investment in the history of the industry. Last year, for the first time since the war, there was not a single order for new rolling stock. There have been no orders this year and next year already seems certain to be the same.

The right hon. Gentleman said in his speech last week:
"My job is to show, before the next election, that our vision is the right one"—
he has certainly got a hard job—
"for passengers … for those who work on the railways."
Perhaps he could make a start on his task by trying to persuade the workers at ABB at York, the most efficient skilled carriage builders in Europe, that his vision is the right one when it is the Government-induced investment blight arising from privatisation that has just destroyed the 750 of their jobs.

The right hon. Gentleman—he will be relieved to know that this will be my last quotation from his speech, which is a mine of information—also said:
"Privatisation is happening; and will bring better services to passengers."
Before hon. Members cheer, I would like to know where on earth the Secretary of State thinks he has been. Does he not know that private train operators will not have to meet minimum standards for rolling stock, including the provision of on-board lavatories, space for storing bicycles and proper facilities for wheelchair users; that minimum station standards, including security and cleanliness, will be relaxed by the franchising director where stations are repeatedly vandalised if he thinks that it would not be cost-effective for train operators to keep to those standards; and that train operators will be free to cut staffing on trains down to a minimum safety level which will mean fewer guards and staff?

Does not the Secretary of State know that train operators will not even have to publish timetables for all passenger trains stopping at particular stations where more than one operator runs those services? Despite all the hoo-hah that the previous Secretary of State made about ending overcrowding on commuter routes, does the right hon. Gentleman not realise that train operators on commuter routes will be allowed to increase passenger loading and standing during the rush hour after privatisation because all but five routes are now below the maximum level of excess capacity that he is permitting?

If the right hon. Gentleman really wants to find out what the ethos of privatisation means for passengers, he need look no further than at what happened only last week on the Torquay line for an elementary lesson in privatisation economics. He will learn that while there was a time when people used the trains to travel to their destinations, in the run-up to privatisation, as the pricing manager for South Wales and West Railways has been frank enough to admit, trains are now run to satisfy
"value for money aspirations of its customers."
If, to use the pricing manager's phrase, exceptional loadings—which means if there is a high demand for a train service—occur, then, rather than put on more coaches, season ticket fares are increased by no less than 56 per cent. to suppress the demand. That is privatisation economics: do not accept people simply because they want to use train to travel; bung up prices to maximise revenues and profits and turn away half those who want to use the services if they cannot pay.

Not a single specific argument for rail privatisation stands up to scrutiny. The only defence to which the right hon. Gentleman can resort, as he did last week and again this morning—unfortunately too late in our interview for me to reply, so I will do so now—is that other privatisations such as British Airways, British Telecom and the British Airports Authority have, he says, been a success. He therefore claims that this privatisation will succeed, too.

Quite apart from the fact that most people would not regard the privatisation of water and the utilities as a howling success, let me ask the right hon. Gentleman one straight question: does he really believe that a privatised British Airways or British Telecom would have been a success if they had been split up into 94 separate, independent parts all competing against each other?

If the hon. Gentleman knew how British Airways worked, he would understand that it sub-contracts a large part of its work. It does not own its aircraft but leases most of them. It sub-contracts baggage handling and buying in meals. It is a decentralised and disaggregated business, much as British Rail will be.

The Secretary of State cannot get away with that. He misrepresents the position. In the case of the privatisation of British Rail, no single command centre within the organisation is proposed. Every piece will be independent and separate, and must negotiate and commercially compete against every other section. The right hon. Gentleman must take that point on board. It is a crackpot structure, which is the basic reason why it cannot succeed.

Let me make it clear that Labour wants not merely a publicly owned railway but a much better railway. We want a rail renaissance in this country. Our objective is a high-speed rail link, not merely from the Channel tunnel to London—under this Government that is 10 years too late—but up through the heart of Britain to the north of England and Scotland, with high-speed connections to the east and west of England and to Wales. Our objective is to transfer freight from road to rail by creating a piggy-back freight network with freight terminals in all major urban and industrial areas. We shall develop a national public transport information network integrating rail and light rail with bus services wherever feasible.

At the heart of our policy is the integrated transport strategy that this nation now desperately needs. Such a strategy is incompatible with the privatisation and break-up of our railways. The sooner this absurd privatisation is swept away into the dustbin of history, the better for our nation.

4.12 pm

I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:

`believes that privatisation of the railways will bring better services to passengers, as has happened with previous privatisations, such as British Airways and British Airports Authority; contrasts this with the Opposition's commitment to renationalise the railways; welcomes the announcement that Railtrack will be floated next Spring, allowing access to private capital and opportunities for investors; and further welcomes the progress that has already been made on privatisation, which will lead to a new era for passengers, with fares and services protected for the first time.'.
First, I thank the hon. Member for Oldham, West (Mr. Meacher) for his good wishes at the inception of his speech. May I reciprocate by saying how much Conservative Members wish him good fortune in the shadow Cabinet elections?

I welcome the opportunity to have another debate on railway privatisation. First, I should like to say a word or two about the dilemma for the Opposition, not just in opposing a policy that is under way but also when their own policy is changing. Then I shall bring the House up to date on the progress that has been made with privatisation since we last debated it in July, after which I shall deal with some of the hon. Gentleman's criticisms, particularly on safety and the position in the south-west. Finally, I shall explain how our policies will bring about the revival of the railways, which I am sure the whole House wants to see.

Listening to the hon. Gentleman speak, who would have thought that since 1964, under Labour, 655 stations were closed whereas, under the Conservatives, 244 stations have been opened? So I shall take no lectures from the Opposition on running a decent railway.

May I get a little further away from the terminus before I grind to a halt at the first signal?

Earlier this month, there was a humiliating U-turn on railways at a seaside conference. That was in Brighton at the Labour party conference, where the Leader of the Opposition caved in to the trade unions and promised to renationalise the railways—a commitment carefully avoided for two years but now entered into not just at some unspecified date in the future but as soon as possible.

The reasons for that change of heart remain obscure. I must tell the brothers below the Gangway that, although they accepted the resolution at the party conference, the motion before the House contains no such mention of a publicly owned railway. Why is it that, having made that commitment and reconfirmed it, the Opposition make no mention whatever of it in the motion?

Perhaps the reason for the reversal of Opposition policy would be less obscure if my right hon. Friend had a glance at the Register of Members' Interests and saw how many of the Opposition are sponsored by railway unions.

My hon. Friend will have noticed that no answers were given to the questions we have consistently asked: what are they going to buy back, and how will they pay for that? The hon. Member for Oldham, West made not a single mention of how the Labour party would fund the policy that he has recently embraced.

No sooner had the leader of the Labour party declared his new policy, and had it repeated by the hon. Member for Oldham, West, than he was backing off from it as fast as possible on the "Today" programme the very next day. No sooner was the Opposition's timetable published than they had to rush out a supplement. The transcript of the "Today" programme shows that it is clear that the right hon. Member for Sedgefield (Mr. Blair) refused to answer the question of how Labour would pay for renationalisation. The question was again ducked this morning by the hon. Member for Oldham, West when Sue MacGregor asked it. He was totally unable to answer it.

I put the same question to the hon. Member again. How will the Opposition pay for renationalisation? Is the answer to be higher fares, or is it to be higher taxes or higher borrowing? What exactly is it that they propose to renationalise? Is it Railtrack? Is it the rolling stock companies'? Is it the franchised companies? It is odd that, having given that commitment, there is nothing about it in the Opposition motion.

The story gets more confusing because, on 26 September, on the Channel 4 news, the hon. Member for Oldham, West said:
"there can be no guarantee that the level of public subsidy will continue indefinitely into the future."
Having listened to the hon. Member restate his commitment to publicly funded railways, I find it odd that at the same time the Opposition are refusing to commit themselves to continuing public subsidy for the railways. What kind of message does that send to passengers? No wonder a recent headline in The Guardian read, "Meacher in trouble over rail privatisation pledge".

I made a very good speech at Blackpool and it deserves a further audience. The hon. Member for Oldham, West omitted to read out some sections of it.

During the summer, we saw the other traditional Labour tactic—the scare story. The Opposition are now so desperate to frighten passengers off the railways that the hon. Member for Oldham, West is soliciting leaked documents. As he said in an article for Railway Magazine:
"leaked documents are particularly welcome. I promise to make good use of them."
Those Opposition Members who hope at some point to be Ministers may well come to regret the day that that statement was made by the hon. Member for Oldham, West.

In response to the scare stories on safety, I would like to draw attention to the independent Health and Safety Commission, which reported on 23 August:
"there is no evidence of any overall decline in health and safety standards".
Even the trade unions are beginning to lose patience with the hon. Member for Oldham, West. A representative of the National Union of Rail, Maritime and Transport Workers said in a BBC Bristol interview on 14 September that the hon. Gentleman's claims in that particular case were nonsense.

Before we leave the question of safety, may we consider the Forth rail bridge and Mr. John Rimington's various examinations? I do not expect an answer from the Secretary of State off the top of his head, but may I ask the Department of Transport in all seriousness to give a full statement of its assessment of the safety involved in what is the greatest engineering monument to the 19th century?

I shall write to the hon. Gentleman, but I think that I am right to say that we have asked the HSE to do a survey of the Forth bridge and to let us have its findings by the end of the year. I believe that to be the case, but I shall confirm it in writing.

After the incident that I have just described, we then had the spectacle of the hon. Member for Oldham, West attacking the Government in a press release on 26 September for helping railway employees to make bids for the various rail companies that we are privatising. Is the hon. Gentleman really saying that he does not want the people who run the services at the moment to have a stake in their future?

What about the management and the employees who recently bought the former British Rail sandwich operations for £11.5 million? Is he really saying that Labour wants to spend £11.5 million buying that company back from its employees rather than conceding that his policy on renationalisation is old-fashioned and out of date?

Does my right hon. Friend agree that, if the Labour party were to go ahead with proposals such as those made by the hon. Member for Oldham, West (Mr. Meacher), they would undoubtedly be vetoed by the shadow Chancellor, who would say that there was not enough money to carry them out?

My hon. Friend's point gives rise to an interesting question. Why is it that the shadow Chancellor has not allowed a motion to be tabled in the name of the Opposition, reaffirming the commitment carried without any contradiction at the Labour party conference only 14 days ago? I wonder whether there is a split in the shadow Cabinet.

We have heard scare stories about fare increases. I remind the House that fares increased by more than 22 per cent. in real terms in four years under Labour. Under the present Government, key fares will be frozen to the retail prices index for the first three years from January 1996, and then fall below that for a further four years.

The hon. Member for Oldham, West repeated that Railtrack's access charges will increase. He must know that that is not the case. The rail regulator has said that, on average, access charges will be 8 per cent. less in real terms this year than they were in 1994–95 and should then fall below the RPI for the next five years. They will go down, not up.

The Opposition claim that train operators will be able to make cuts in services for profits. According to the legislation, that will not be possible, as service levels, for the first time ever, are specified by the franchising director in the passenger service requirements for each company.

If a franchiser rats on his obligations, will the Secretary of State ensure that the franchise is terminated? In our opinion, the arithmetic does not add up. One cannot prevent fares from increasing and at the same time maintain services under that scheme. I want an undertaking from the Secretary of State that if there is any failure—any reneging on the franchise—that part of the service will be brought back into the public sector immediately.

It would revert to the franchising director, to the Office of Passenger Rail Franchising. If the person with the franchise for that seven years reneged on his obligations, the franchising director would have to re-let the franchise.

All Labour says is that it will campaign to prevent privatisation, but that campaign has already failed. Privatisation is happening and, month by month, businesses are being put into the private sector. Already, more than £4 billion by turnover of the old British Rail is on the market. The momentum will continue well into next year, with the flotation of Railtrack and the start of the new franchised train services. No wonder the Sunday Times reported this week:
"the privatisation war is being won."
Our policies are clear and succeeding; Labour's policies arc muddled and failing.

I shall now describe the progress that we have made since we last debated the subject, in July. As the House knows, there will be 25 geographically based franchises for the existing train operating units. We have made substantial progress. Invitations to tender for seven franchises—41 per cent. of the total by turnover—have been issued. I expect that figure to increase to 51 per cent. by about the turn of the year, when the next two invitations to tender are issued. Those are serious bids from serious bidders. Final negotiations with the shortlisted bidders for the first batch—three franchises—are under way. I look forward to announcing the results shortly. The passenger service requirements for a further three franchises have been published, so now more than 55 per cent. of services are being, or have been subject to, consultation.

The franchising director and his staff are working to put further franchises out to tender in a responsible, responsive way as part of a rolling programme. We want a flourishing rail freight industry in the private sector. British Rail's freight customers are enthusiastic supporters of privatisation. They know that competition should give them a better choice of better services. I share that enthusiasm.

We have already offered freight businesses for sale with a turnover of £750 million. The loss-making Red Star has been sold. We have indicative bids for the three Trainload Freight businesses. We have final bids for Rail Express Systems. I expect bids for Freightliner early next year.

Another cornerstone of privatisation is the sale of the three passenger rolling stock companies. Rolling stock leasing will leave train operators free to concentrate on their main business: planning, operating services and looking after the customers. All three ROSCOs, with a turnover in excess of £750 million, are being sold. Final bids for the companies were received last month and I am confident they too will be in private hands before the turn of the year.

We have sold the six British Rail heavy maintenance depots, seven design offices and the on-board catering operation. For the depots, more than 70 organisations expressed interest. There were competitive bids from engineering companies, train builders, and management buy-out teams. All were sold as going concerns. That gives the lie to the Opposition's claim that privatisation cannot succeed.

I want to record that we are pleased to see, not just here with the maintenance depots but in all sectors of privatisation, strong bids by management-employee teams. It is clear from the way that those bidders are reacting to the new opportunities that they see privatisation as the best way to escape from the confines of a structure that has crushed their imagination and sapped their energy.

To complete my progress report, I announced last week that the Railtrack stock market flotation will take place next spring; it will put control of railway infrastructure firmly where it belongs—in the private sector—and will bring the total turnover of all the railway businesses on the market to more than £6.5 billion. I congratulate all those who have worked hard to achieve that progress. Clearly, Labour's campaign to prevent privatisation is not working.

Let me now deal with some of the points raised by the hon. Member for Oldham, West, including the fare increase in south Devon which he mentioned. That fare increase came into effect in May under the traditional publicly owned and publicly accountable regime. It is exactly the sort of approach that rail privatisation is designed to stamp out. Once the services involved are franchised, there will be a private sector operator who will be more responsive to passengers.

As I said last week, I am concerned about this case. For the present I have asked British Rail to look urgently into the decisions that have been taken. But for the future, under the new fares regime, that sort of price rise simply could not happen. The franchising director has announced that for three years from January 1996 operators will not be able to increase key fares overall above inflation. After that, fares will be capped at an average of RPI minus 1 per cent. for each of the following years. In this particular case, the weekly season ticket would be protected as well as saver fares. More generally, the franchising director will take into account local needs when he publishes for consultation his draft passenger service requirement.

Every privatisation has had its share of scare stories: for example, the privatisation of British Telecom and the pay phones which, it was said, would close, and the fuel price rises that have never happened. It is therefore hardly surprising that the safety issue has emerged for the railways—it is an issue that I take seriously. There is no reason to expect privatisation of an industry to destroy management's concern for the safety of its customers, its staff or the population at large. There is no evidence to suggest that privatisation of British Airways or the British Airports Authority has reduced safety standards in the aviation industry. There is no evidence to suggest that separation of responsibility between those organisations and others does not work effectively, reliably and safely.

Safety remains of paramount importance in the railway industry and the key factor should be that it is overseen independently. We have implemented in full the Health and Safety Commission's recommendations for an enhanced safety regime for the restructured industry. The Health and Safety Executive has a continuing responsibility in law for the regulation of the industry's safety.

As I have said, the Health and Safety Commission confirmed there is no evidence of any overall decline in standards. In fact, during Railtrack's first year of operation there were major improvements in seven of the eight main indicators measuring injury levels, which were 18' per cent. better, and the passenger train collision/derailment figures were 31 per cent. better.

We are not complacent about safety; Railtrack is not complacent, nor are the train operating companies, nor are the thousands of people who work in the industry.

In the Hidden report on the Clapham rail crash, Sir Anthony Hidden recommended that

"British Rail shall ensure that the organisational framework exists to prevent commercial considerations of a business-led railway from compromising safety."
I believe that that responsibility has passed from British Rail to Railtrack. How does the Secretary of State square the fact that Railtrack will be able to exclude commercial considerations when it is a commercial company in a private sector?

Its safety regime must be validated and scrutinised regularly by the Health and Safety Commission. That regime has been established in the full knowledge that the various components were about to be privatised. We are not complacent about safety. The HSE will continue its independent monitoring and investigation to ensure that standards are maintained and commitments are met.

We remain firmly committed to the modernisation of the west coast main line and I am pleased that it is progressing well. The west coast main line modernisation has been designated as a priority project on the trans-European railway network.

I used it when I visited Blackpool. I am pleased to announce that the United Kingdom has secured nearly £7 million of European funding this year for the scheme, and I am confident of securing further funds in 1996 and beyond.

I shall conclude by setting out how our policies will bring about a much-desired revival of the railways. In the past 45 years or so, Governments of all persuasions have poured money—more than £54 billion—into British Rail. Despite that, the railways declined. In 1953, 17 per cent. of journeys were by train and 24 per cent. of goods were moved by rail. Today, both figures are about 5 per cent. and they have continued to drop. Why? I believe that it is because state ownership and state control have failed the railways. The monolithic monopoly failed the passenger, it failed the freight customer, and it failed the owners—the taxpayers.

Does the Minister not think that the concentration of public investment in roads during that period had something to do with it?

No, I do not think that one can sustain that case. I do not think that that explains why the percentages have decreased. It may explain why the number of people who use cars has increased, but I do not think that it explains the modal shift.

The old-style British Rail structure was an introspective organisation and I am determined to refocus it outwards onto passengers. Something had to be done to wipe out the past and make a fresh start and someone had to create the conditions for a new approach. That is what we did with the Railways Act 1993. It restructured the industry: first, to improve the quality of service to the customer; secondly, to improve the efficiency of the railways; and, thirdly, to halt and reverse the decline in the use of the railways.

We have put in place bodies to safeguard the wider interests of users and to regulate the industry. We have created a franchising director, who awards franchises to run passenger services on the basis of competitive tendering. He is also required to secure an overall improvement in the quality of railway passenger and station services.

The Government want to see more people travelling by train. One of the ways to persuade people to travel by train is to give them stable fares. That is what we have done, as I said a moment ago. We have given that commitment because we are confident that privatisation will reduce costs and benefit the travellers. For the first time, the wide-ranging protection and supervision of an independent external regulator has been placed on the industry, with clear duties to protect the interests of rail users. We have seen that working in practice: the regulator has taken firm steps to ensure that the number of stations selling through tickets will not be reduced.

I announced last week that we intend to privatise Railtrack in the spring so that, freed from the inevitable constraints of public sector funding, it can and will look to raise investment from a wide range of private sector sources. The flotation will open the way for institutional investors and lenders to finance Railtrack, thus harnessing private sector capital for investment in the railways. The privatisation programme will make Railtrack even more accountable to train operators who are freed from the old monolithic framework.

Labour's only ambition for the railways is to look back, not forward, and to return them to the dark ages of state control when they must compete with the national health service and education for taxpayers' money. Privatisation is already bringing better services to passengers and opening up new opportunities for businesses.

InterCity West Coast has introduced packages, including car park and meal costs. On all the Anglia trains there are facilities to improve access for disabled people. Thames Trains has connecting bus services using joint ticketing for tourist locations. With all that successful change in the railways, who knows? Perhaps the Opposition will do another about-turn and adopt our policy 'on privatisation. I invite the House to support the amendment in my name.

4.34 pm

In his rapid and plainly uncomfortable gallop through the speech that, presumably, was written by the same people who wrote speeches for his six predecessors, the Secretary of State did not mention the real reason for privatisation. We know from the Chancellor of the Exchequer and from a leaked memo that the real reason why privatisation has to be pushed ahead is that it should raise £1.5 billion and it is absolutely essential for the arithmetic of tax cuts. That is what it is all about—putting money into the system before the general election, even if the cost to the taxpayer will be much higher thereafter.

It is clear that the chaos that is the hallmark of privatisation is spreading through the system. Some things are absolutely plain to the naked eye. When we stand on stations and look at the track, we see weeds growing between the rails and we suddenly realise that the system does not carry out even routine maintenance.

The Secretary of State made play of the fact that the new regulator will insist on a new fixing of rail fares. He managed not to say that that resulted from an outcry over through ticketing, which the regulator has made clear he does not like. One suspects that he will get away from it as fast as possible.

The Secretary of State did not mention the fact that most rail travellers use discounted tickets. They represent the largest number of travellers, yet no guarantee has been offered that their interests will be safeguarded.

The position is much more serious and is truly depressing, because the Government are not interested in transport and are prepared to stand aside and watch the entire system fall apart. That is the political and economic reality.

Railtrack is not in command. Simple things are totally beyond it. I have watched disabled people try to stagger up a staircase where normally lifts would be available only to be told by Railtrack that it could take up to six weeks to get things moving again.

Railtrack's day-to-day administration is failing disastrously. It did not surprise me, therefore, that when its chairman was asked to present a clear plan for the next 10 years to the Select Committee on Transport he singularly failed to do so. He has given us no indication of how he expects Railtrack to develop, nor has he addressed what will happen when taxpayers realise that they will have to contribute even more to the dismembered system after privatisation. That will not be particularly popular with the electorate.

People have been told that privatisation is the answer as it will attract vast amounts of private finance and there will be a much higher standard of service. When they suddenly discover that, far from getting a higher standard, they will have to pay more to maintain less than they have now, they will be quite upset. They may even feel that the Government have failed to make a honest statement of what will happen to the railway industry after privatisation.

It is frightening. Two years ago, the Railway Industry Association told the Government that no contracts for rolling stock were being signed. It told them what would happen this year and next year. What was the Government's answer? They said, "Do not worry, all will be well in future." The Secretary of State said, "Do not worry about safety; everything is in control." He gave answers listing the recommendations in Sir Anthony Hidden's report on the Clapham disaster that were implemented. What he has not answered is why specific, important developments have not been carried out, even on the timetable set by his Government.

On train data recorders, we are told:
"this equipment is specified for new rolling stock."
Great. True, we are not going to have any new rolling stock, but, if we did have any, it would have all the new equipment. I am sure that that will satisfy everyone.

We are told:
"the National Radio Network system of communication"
is to be installed. We have seen the need for that in the recent past. The system will be completed by 1997, because
"Technical difficulties and higher priority safety projects have extended completion of this programme beyond BR's original target of 1995."
We know that the Government are very concerned about safety; surely they must be going to make automatic train protection a priority. No, I am afraid that they are not. By some dreadful mischance that is not at all plain to me, they have decided that that is not the answer.

"A programme of alternative train protection measures is being developed"—
alternative measures, hon. Members will notice.

"Railtrack and BR continue to examine the implementation of these measures"—
and so on and so forth; there are reams of it, all signed by the junior Minister.

No. I have a very short time in which to speak, and I am not going to waste it.

The reality is clear: the rolling stock is virtually not being built. That has caused job losses in York, and a knock-on effect in Derby and Crewe. If an incoming Government wanted to invest a large amount in rolling stock, they would find that very few companies were capable of tendering; those that did would almost automatically be foreign-owned. Why does that matter? The simple answer is that employment is needed in this country. The skills were available in this country; the Government not only dissipated them, but seemed to go out of their way to make it impossible for those men and women to find jobs.

I believe that the whole idea of privatising the railway system should have been abandoned. It really does not work. It is clear from the day-to-day operation of the system that it is creating incredible ill will among both passengers and staff. Above all, it is not addressing the real problems. No investment is being made in the system, because no one knows for how long the changes will be in place. There is no indication that there are vast amounts to be made through investment in new rolling stock, because no one knows who will lease it, how long they will be there and what charges they will have to pay.

We hear about Railtrack's demands for economic rates; what we do not hear about is the effect on many people of its immediate application—even simple, mean little things such as the fact that charity trips for people in my constituency have been wrecked because the charges are too high; stupid things such as the fact that rolling stock must be carried on the roads, not because that is an effective way of moving engines but because the charge for moving an engine from one end of the system to the other is so high that people prefer to transport them on the roads. What a crazy development. How can anyone even pretend to defend it?

The most depressing and frightening aspect of the programme, however, is the fact that the Government do not care about the railway system. What they care about is the money that they can raise, in any way at all, before the next general election. That is as clear as daylight. It is clear to those who find themselves—as I did recently—standing on an empty platform. Although nearly 600 people were affected, not one member of staff was available to give any information. There had been an accident, but so many stations have now been "de-staffed" that the public had no one to turn to. One marvellous man on his way to give a concert in Liverpool addressed the air, asking, "Is there anyone, anywhere, who knows anything about what is happening?"

Answer came there none, because in 1995, under this Conservative Government, transport is not even a means to an end. It is not even a safe system of moving people and goods around. It is a way of flogging off assets. Handing over Red Star for £1 was an open insult to those who had built up the business which, until all this crazy reorganisation, used to make a profit. Looking at the railway system only as a means of making money out of its estates is an insult to all who want safe, warm and punctual trains to carry them to work and home again.

The Secretary of State is an honourable man, but like most of his predecessors he is hoping that, with any luck, he will not be in his job long, so it will not matter to him what happens when the Government's policy comes home to roost in a big way. I should warn him that morale in the rail system is disastrously low, because railway men and women have been treated with open contempt. They are forbidden to speak openly about the problems that arise in their daily jobs, they are continually asked to reapply for their own positions and many of them are told that they are no longer useful. Executives who boast that they do not understand the system are brought in to organise, and the results are seen from day to day in the administration of the system.

I believe that this is going to be a political catastrophe for the Government that will make many of their previous idiocies look like a beginner's effort. In the meantime, however, they will strip a respectable system in need of investment of all hope, and the cost to us all will be very great indeed.

4.46 pm

It is always a pleasure to follow the hon. Member for Crewe and Nantwich (Mrs. Dunwoody). Although I enjoyed her hyperbole I found it somewhat distracting to hear her speak so obviously from the viewpoint of a vested interest. She is sponsored by the National Union of Rail, Maritime and Transport Workers. I recall that in the debate here on 17 May almost every Opposition speaker was sponsored by one or other of the rail unions. That shows up the clear difference between them and us: they speak for the vested interest, we speak for the public interest. So much was clear from the two Opposition speeches that we have already heard today.

The Railways Act 1993 provided the legal framework for the privatisation of British Rail and the introduction of a new industry structure. The Act received Royal Assent in November 1993, and most of its principal changes were brought into effect by April 1994. But I shall begin by dealing with the recent history of the railways in this country.

The railways were first nationalised in 1948, created as a monolithic monopoly, a trade union-oriented organisation that ill served the general public. Over the past 45 years, about £54 billion of public money has been ploughed into the rail system, but the return on that investment has been very poor. The number of journeys travelled by rail has fallen from 17 per cent. in 1953 to only 5 per cent. today—a lamentable statistic that we must do something to turn around. Indeed, today only 10 per cent. of the British public can claim to travel regularly by rail. We must increase that figure.

It would, in the face of the statistics and of this brief thumbnail sketch of the past 45 years, be irresponsible not to act to bring about change. It would be irresponsible also simply to throw more public money at the rail system, because that clearly has not done any good in the past and it is not the answer. The hon. Member for Oldham, West (Mr. Meacher) was quite outrageous and, I believe, disgraceful in his speech today. He misrepresented the facts and I shall make it clear how he did so.

The need for change is clearly established, and all parties agree on that. The only question is what form that change will take. In considering that, we must first define the objectives of the change and then make a sound judgment on its efficacy. Let me state what I consider, from my humble perspective, to be the three key objectives. I shall keep it simple for the benefit of Opposition Members, who like it that way.

The first—my right hon. Friend the Secretary of State has acknowledged it—is to ensure, safeguard and, indeed, enhance safety.

The second objective is to improve services and quality and to deliver lower costs for rail users. We owe it to them to make an improvement.

The third objective is to attract more passengers on to the railway, which would reduce costs for everybody by spreading the high fixed costs. It would improve the environment tremendously, particularly by reducing pollution, and by delivering a more friendly use of land many other environmental benefits would be delivered. It would also take the pressure off the rest of our transport infrastructure, which is very necessary. Achievement of the third objective would, of course, assist delivery of the first two objectives.

We must consider how to move forward. Privatisation is, I believe, clearly the best way to do so. As my right hon. Friend the Secretary of State said, it proved to be the best option with British Airways and the British Airports Authority. Opposition Members, I seem to recall, although I was not in the House then, said that the privatisation of BA would end in tears. They said that safety would be jettisoned, if hon. Members will excuse the pun. What happened? BA went from strength to strength. Nothing could have been further from the truth than Opposition Members' claims. They were irresponsible to make those claims, and they are irresponsible now to make claims about the railways.

BA has gone from strength to strength and is delivering better customer services. It is competitive and is one of the best carriers in the world, whereas French airlines are still absorbing massive amounts of public subsidy every year, taking money that could be spent on pensions, education and health. They will continue to fail until they are privatised, as they will be quite shortly, I guess.

If we decide that privatisation is the best way forward, we must look carefully at the mode of privatisation. The way in which we privatise must be carefully designed and controlled to ensure that it yields the maximum benefits to the travelling public and entices more people to use the train.

I congratulate my right hon. Friend the Secretary of State and his predecessor, my right hon. Friend the Member for Peterborough (Dr. Mawhinney), on the excellent privatisation scheme—it is extremely well based—that they have introduced. I am sure that, given good will and integrity, it will be made to work very well and will deliver great benefits to my constituents. I believe that my right hon. Friends have created the right climate for it to work. They have created the right climate for service levels to be improved through the passenger service requirements and for costs to be reduced by their decision to stop the continued and seemingly unavoidable increase in fares.

The facts are quite clear. Fares have increased by 29 per cent. in real terms over the past 16 years, during which we happen to have had a Conservative Government. That is a fact. That is a rise of less than 2 per cent. a year in real terms. My hon. Friend the Member for Hertsmere (Mr. Clappison) revealed to the House on 17 May that, under Labour from 1974 to 1979, fares increased by 31 per cent. in real terms—a rise of over 6 per cent. a year in real terms. These figures are provided by the House of Commons Library.

There we have it. Under Labour, there was a more than 6 per cent. increase in real terms every year and under the Conservatives the increase has been under 2 per cent. I know which my constituents would prefer.

I also know that my constituents would prefer no rise at all—in fact they would prefer fares to fall in real terms; that would be good. It would address the cost-volume argument and get more passengers on to the railways so that we could continue to drive costs down. I know, therefore, how much my constituents welcome the policy of my right hon. and hon. Friends to hold fares at the level of inflation—that is, no real-terms rise—for the next three years and then to cut fares by 1 per cent. below inflation for the four years following. I congratulate my right hon. and hon. Friends on their policies.

I now turn to my own railway line, the London-Tilbury-Southend line which my hon. Friend the Minister knows well. Bids are now maturing for my line. I understand from the press—I have no privy knowledge of this—that there are four short-listed contenders, three private and one management bid. I do not expect any nods or winks from my hon. Friend the Minister on that. However, I expect that he will make a decision on the matter in the coming weeks.

Thus we can see that there has been a healthy bidding process. There has been real competition and I am sure that the financial backers of all those four bidders have exercised great diligence in ensuring that the bids are sound and viable. I do not envy my right hon. and hon. Friends the decision that they will have to make. I shall try to help them by giving a personal view of the process of evaluation through which they will be going.

First, all my right hon. and hon. Friends know that I believe in smaller government, unlike the Opposition. Rail privatisation has a part to play in smaller government so we must look in the bid for a lower subsidy profile. We must look for subsidies to decline year on year. I freely acknowledge that it is unlikely that we shall get to zero subsidy on the LTS line over the franchise period, which is said to be seven years. Nevertheless, we should see subsidies falling.

The question of the franchise period brings me to my second point, which is that the successful bidder must bring a significant investment programme with his bid. The problem is, however, that a seven-year franchise term militates against the investment that is needed. Such investment may not be viable over a six-year period. Perhaps a great investment programme would be more viable over a 10-year or 15-year period. I therefore urge my hon. Friend the Minister to be flexible in looking at the franchise periods when he is deciding on the bid, and especially so if the bidders are prepared to countenance new train orders as part of their bid. The bidders should, of course, be prepared to take on risk.

The hon. Gentleman talks about the benefits of competition being brought into the railways. Once a franchise has been granted, the franchise operator—the train operating company—will have a monopoly for however long that franchise lasts. By suggesting that the franchise period is extended, is not the hon. Gentleman giving the private operator the opportunity to have a total monopoly?

The hon. Gentleman says that subsidy will continue and that all the profit during that period will come out of public subsidy, yet he is suggesting that there should be a monopoly on the line for a very long time—for twice as long as the Government have recommended in their proposals.

The hon. Gentleman makes an important point, and does so well. Of course there is a fine balance here, and a decision to be made between the monopoly and the need for a longer franchise period so that proper investment can be encouraged. He will be aware that ABB will deliver trains to the Great Northern line soon, after which it will be without substantial future rolling stock orders, so I hope that bidders will promote orders so that we can build up our manufacturing base in the area. I hope that he will moderate his tone and listen to what the Minister says on the subject when he winds up.

I am grateful to the hon. Gentleman for letting me intervene again, but perhaps he has missed the fact that the ABB factory in my constituency, which makes those trains, is to close in December because of the lack of orders that has resulted from rail privatisation.

That is the point that I was making. I am aware of what is happening and will deal with it later, but first I must make a little progress.

Bidders must be prepared to take risks. The private sector must accept the maximum responsibility for planning in the general economic environment. They must cope with risks such as changes in GDP, in inflation, in track access costs and in VAT regimes, and in many other factors. The public purse should be protected from those inherent risks as far as possible. That happens with other private businesses, and it has happened with other privatisations, such as that of British Airways, so I am sure that the Secretary of State will look to bidders to take on such risks.

I have covered three criteria. The House may consider those in a technical manner, but what really matters is the criteria that our constituents and passengers will adopt when judging rail privatisation policy, so I shall list some of the criteria in which my constituents will be interested.

First and foremost, the public want to see real change. Leaving things as they are does not represent a solution for my constituents. I do not know what the hon. Member for Oldham, West thinks about that. He sits there smiling, but it appears to me that he advocates no change. Or does he advocate throwing more public money at the railways? He has not told us.

The public, especially passengers, are impatient for change, and rightly so, because they have been ill served by the nationalised British Rail for 45 years, and at great cost to themselves—no less than £45 billion.

But changes must not be superficial. I am not talking about a new paint job for the coaches, a new uniform for the staff or a girl walking up and down like an air hostess—although that would be delightful, and most welcome on my LTS line.

The speed of implementation of change is a crucial requirement for securing public confidence. Equally crucial is quality, which must be present in every possible aspect of the business.

My hon. Friend will know that Opposition Members are fond of painting the privatised railway as one in which franchise operators will cram passengers into cattle trucks. Surely he accepts that it will be in the interests of private train operators to make their railway as safe and reliable as possible to ensure that the customer sees rail transport as good value for money.

My hon. Friend makes a wise point. He is characteristically supportive of the Government and I thank him for his comments. I entirely accept what he says.

My local line, the London-Tilbury-Southend line, has enjoyed an investment of £150 million in resignalling. The money will have been spent by summer 1996, and the benefits in terms of reliability are already flowing through.

Reliability is not the only thing that needs to be improved; station services need to be improved too. We need real commitment from bidders, not just general aspirations, and I am sure that Ministers will consider such matters carefully. Reliability must continue to be driven up to higher levels than those dictated by the current passengers charter, and I am sure that really serious bidders will achieve that within their bids. Likewise, they must commit themselves to outperform the passenger service requirement. I am sure that they will consider that carefully.

Like reliability, the number of trains and seats provided is crucial on the LTS line. Again, we should be well served on the LTS line, because as well as the investment in resignalling, for which I thank my right hon. Friend, 25 replacement 317 sliding-door trains are coming to the line. I understand that the first two, for driver training, will be delivered in March 1996, and a further 10 by May that year. The full 25 will be in service by October next year, subject only to the ability of ABB of York to deliver the new 365 trains to the Great Northern route to release the 317 trains for service on the LTS line. They will replace some of the 35-year-old stock now on my local line. I understand that the lease documentation for the 317 trains that are expected is now completed, and I hope that there will be no hiccups.

We cannot rest on our laurels or be complacent. We need a new option for new trains on the LTS line in addition to the 25 extra 317 sliding-door trains. There are two reasons for that. Clearly, new trains would deliver improved quality and reliability, attract more passengers on to the line and so drive down costs. Secondly, ordering new trains will help the United Kingdom manufacturing base. We need flexible financial arrangements, and we need the City to be innovative in developing those with the industry.

That is one of the most exciting elements in the franchise programme developments. It gives the private sector the opportunity to respond to the challenge of reviving rolling stock manufacturing in Great Britain and delivering the benefits that the hon. Member for York (Mr. Bayley) seeks.

It has been some time since new rolling stock orders were placed. I hope that bidders will set out how they will place orders for leasing trains, and that that will breathe much-needed life into our rolling stock manufacturing industry.

All that will promote a more efficient and cost-effective railway on the LTS line, and at the same time improve service levels and quality. The public will want that to happen quickly, and if it does we shall see an improved development of the network and more passengers coming on to the line.

Four years ago, 35,000 passengers a day travelled on the LTS line, but now only 22,000 do so. There are two reasons for that fall, one cyclical and the other structural, and we understand them well. The cyclical reason is being dealt with now, as unemployment falls. Today I see that unemployment is at its lowest level for four years, and I welcome that.

We must have more employment in the construction industry in docklands, in the service industries and in the financial institutions in London. That will bring more passengers on to the line. But there is also a structural change, in that patterns of work are changing and employment is restructuring. Changing technology in City financial institutions has displaced many jobs. We must increase the number of passengers travelling on the line to 40,000 a day by 2000, and we shall do that only by privatisation. Doing nothing will result in the number of passengers continuing to fall, with those who remain bearing a greater burden of the cost, as they did under Labour from 1974 to 1979.

One item needed for the development of the network and the LTS line is a new Parkway station in my constituency, and I shall argue for the option to be kept open in the Castle Point local plan at the local plan public inquiry. Curiously, the Labour council wants to remove the option.

A new Parkway station would deliver great benefits to my constituents and to all travellers on the line. It would enable the LTS line to compete with the parallel Liverpool street line that lies to the north, and that is important. It would deliver real benefits and greater convenience to existing passengers, and would deliver general planning and landscaping benefits to Castle Point—for instance, a new and secure high-capacity car park. It would entice new passengers off the roads and on to rail, which would have clear and widely accepted environmental benefits. It would protect and enhance the Benfleet station and the adjacent conservation area.

Labour's local strategy reflects Labour's national strategy. Labour talks as though its cares but acts as though it could not care less. Labour calls for more passengers on the line, but it obstructs developments that would encourage passenger growth and proper investment in the line.

I do not want to be party political, and I am sure that the House realises that. I want to act in the best interests of my constituents. I hope that the Labour party, both in this House and on my local council, will review its policy and support the sound common-sense change and development of our railway network.

Order. Before I call the next hon. Member to speak, I should point out that we have two debates today and that Members must exercise great restraint. If each Back-Bench speech is as long as the previous one, there will be many disappointed hon. Members.

5.12 pm

I am very pleased that you are in the Chair, Madam Deputy Speaker, as it gives me an opportunity to say how sad I was to hear two days ago that you intend to complete your distinguished parliamentary career at the next general election. But it also gives me an opportunity—since I know that you know this line as well as I do—to tell the sad story of the south Devon rail farce. It is a farce that will teach us useful lessons about what will happen if the privatisation scheme before the House goes forward in its present form.

Madam Deputy Speaker, you will recall that the original problem was that the railway services in south Devon from Exeter to Torbay did precisely what the hon. Member for Castle Point (Dr. Spink) said it should do. It attracted a lot of people off the roads and on to the rail service. It did precisely what everyone says should be done by the railways—it priced itself to the point where it attracted new custom. But the immediate difficulty was that the railway company found that it could not provide an appropriate supply.

As a result—this is well known following the media attention given to this issue—parents of children who travelled on that service found that their children were constantly having to stand in a dangerous situation. They complained to my colleague Richard Younger-Ross in Teignmouth, who took up the issue with the railway company.

Although both the speeches from the Front-Bench Members referred to the case, it is important that we look at it in slightly more detail than they had time to do. South Wales and West Railway wrote to the Rail Users Consultative Committee to say:
"the changes were made in response to an extreme demand situation that we have experienced for the last two educational years."
What changes? The company's response to the changes was to increase fares at a stroke by 56 per cent. The letter went on to state:
"Over 250 passengers were trying to join a train with a maximum of 150 seats.
We have only limited rolling stock resources. This means that we have no extra carriages to put onto the trains—all resources at these times are in use elsewhere, generally for commuters in Exeter. If we transferred coaches on to the Torre train, we would create even worse overcrowding somewhere else."
In effect, the company was admitting that it was trying to suppress demand. That is in direct contradiction to the statements, assurances, promises and prophecies we have had from the Conservative party.

Why did the situation arise? It arose for one simple reason. The explanation was given, not by the railway company and certainly not by the Department of Transport, but by the Rail Users Consultative Committee. Major-General Napier's analysis of the situation was that it occurred because of a gross shortfall in investment of up to 60 per cent. There are different estimates, but the figure is certainly more than 50 per cent. As a direct result of the privatisation hiatus, the company has not been able to deploy appropriate rolling stock to meet demand in the area.

This is not an isolated example—it may be exceptional but it is not isolated, even in the south-west. In my constituency this summer, services were cancelled almost every week, and sometimes several times a week, between Newquay and Par, and all that the travelling public were offered in exchange was a taxi service. That is totally inadequate, and has meant that more and more people have not gone on the railway at all and have driven the full length of their journey.

The cancellations occurred not because there was anything wrong with that particular stretch of line, nor because there was anything wrong with the rolling stock on that line. They did not occur as a result of service or operational difficulties of any sort on that line. The cancellations occurred because of the shortfall in the network as a whole. The company has been taking away rolling stock to meet the shortfalls from as far away as south Wales, and no doubt your constituency, Madam Deputy Speaker, has suffered in a similar way.

Throughout the network, the hiatus in investment in new rolling stock has caused chaos, and there is no indication whatsoever that the privatisation with which we are threatened in the next two or three years will solve that problem. The result is that we have overcrowding, and that is not just a feature of services in Torbay but a feature of many services throughout the country.

I wish to refer to a letter from someone who was a victim of the recent railway accident at Maidenhead, a tragic accident to which we should pay due heed. Professor Robin Hambleton wrote a short article for The Guardian about his experiences in the train accident on the evening of Friday 8 September. He described the frightening experience of being on a grossly overcrowded train when a major incident takes place. He said in a covering letter to me:
"It has always seemed to me to be rather strange that we allow standing on trains—buying a ticket ought to imply buying a seat (compare airplanes, theatres, cinemas).
The thrust of my argument is that the current complacency which permits overcrowding on trains means that we are on track for a tragedy. Remember, banning standing in football stadiums would have seemed unreasonable just ten years ago."
The direct result of the hiatus in investment in rolling stock is not just that we are losing some of the services we need or that we are losing opportunities to get more people back on to the rail system, but that we are creating tragedies in the making.

I do not blame the Secretary of State, who was obviously caught on the hop at the Blackpool conference by the interviewers, but the answer that he gave to this problem was clearly unbriefed and was totally inadequate. I must say that I was also disappointed by his answer this afternoon. To say that all will be well when privatisation takes over does not deal with today's situation, let alone give hope for the future. It was an absurd explanation, and it was made no better by its repetition today. That is symptomatic of the problems that the industry is facing and of the failure of nerve of many people at many levels of the rail industry. Many of the best people are leaving, which is also an indication that all is not well.

The farce of the timetables is also indicative of the chaos that disintegration is bringing to our once proud railway network. We have had as many supplements as The Sunday Times and about as much fiction from the British Rail timetable. Yesterday, I tried to get a simple and comprehensive timetable of InterCity services that I am likely to use, which I have always had in recent years. It is impossible to get that list because it is not brought together in any comprehensible form.

The Confederation of British Industry—usually an ally of the Government—has indicated the nature of the chaos that is to come. In its attack on Government transport policy, it said:
"Somewhere in the course of the debate a realistic yet positive approach to transport has been lost."
Clearly, the CBI has no confidence that there are policy objectives and that they are carefully being driven to promote the future of our public transport system. Rail privatisation is clearly an example of blind faith taking precedence over experience.

I am in some difficulty. Having called this debate, I expected that the hon. Member for Oldham, West (Mr. Meacher) would at long last get off the fence on the vexed subject of renationalisation, bringing back into public control Railtrack at least. I know the difficulties under which the Labour party is labouring. It recognises that, if it made a clear commitment to ensuring that the infrastructure is in the public sector, people on the left of the party would ask, "Why not go the whole hog?" I understand that, but after our debate in July when I pressed the Labour spokesman to come clean on the Labour party's intentions, it really seemed as though it was edging slowly but surely towards a recognition that Railtrack is the key to a successful rail system.

Hints were dropped at the Labour party conference. I do not think that one could accuse Mr. Jimmy Knapp of dropping a hint—it was rather more formidable than that. He made it clear that he was expecting a commitment to match that which we Liberal Democrats have consistently made in the past 12 months. Indeed, he accused us of trying to steal Labour's thunder on the railways—not very difficult, I can assure the House.

We have not had that commitment this evening, but the House is entitled to know. Is it going to be pick and choose, mix and match, or is the Labour party going to commit itself to outright renationalisation of whatever has scampered away into the private sector before the general election?

We assumed that Labour would make its announcement today. The apprentice spokesman on transport, the hon. Member for Fife, Central (Mr. McLeish) might well make it during the final stages of the debate. Let us hope so. The travelling public are entitled to know whether we are going to make certain that Railtrack remains in the public sector. If only the Labour Opposition would get off the fence, stand up with the Liberal Democrats and say clearly, "In the event of our controlling the next Parliament, we will not allow those who have sought to make a profit out of the purchase of Railtrack shares to make that profit and 51 per cent. will be brought back if it has been sold."

It could be funded on a 10-year programme with bonds, it is not difficult, but we need to know whether the Labour party is prepared to make that commitment. The irony is that, once it has been made, it is highly unlikely that Railtrack can be sold. I am sufficiently a realist to understand that institutional investors as well as individuals are not likely to put their money into Railtrack next spring when there are a great many other things into which they could put their money which would have a real prospect of some profit. They will not invest in Railtrack next spring if the Opposition parties are absolutely united in saying that they will ensure that no one benefits from the sale.

During a trip to Wales this July, the hon. Member for Oldham, West was quoted in the Western Mail as saying:
"At the moment I do not know how it will be done but when we are in power we will be looking to bring Railtrack and the private companies back into the public sector."
Two months later, responding to the pressure following our conference commitment to buy back Railtrack, he said rather sulkily:
"We are not going to do the Tories' work for them by saying which bits of the rail network we would leave alone if they succeed in selling them."
He must have had some problems with his leader. We know that his leader and the leader's office have been dictating transport policy for some time. "Rail Privatisation News" reported a few months ago that, when it
"suggested to Party insiders that a commitment to keep Railtrack in the public sector would be both electorally popular and appease the Party's left wing membership, the response was that 'these things are settled in the leader's office'."
The leader of the Labour party, the right hon. Member for Sedgefield (Mr. Blair), has said that he is not going to give any "blank cheques" and yet his spokesman said at the Labour conference, in the debate on the resolution to which hon. Members have referred this afternoon:
"There is the whole question of 51 per cent. buy-back, there are golden shares, there are bonds. There are many different options. I am not at this stage going to give away any details."
That sounds like throwing bones to the jackals at the Labour party conference, but it does not sound as though he is taking the same line as his leader.

I had hoped that we would have a clear commitment this afternoon, but we have not had it. I hope that we will have it later from the hon. Member for Fife, Central, whom I should describe as the transport spokesman-in-waiting.

In the meantime, please may we have a commitment to another important part of the jigsaw of rail privatisation—passenger rolling stock. The development of a rational land use and transport policy surely requires decisions about railway infrastructure to be taken in the national interest, not in the narrow, short-term interests of any private sector company. I ask the Minister and the shadow Minister for a categorical assurance that they are both prepared to spend sufficient money on the renewal of railway infrastructure and of rolling stock to ensure that they comply with the condition that they set out that, in 1994–95, it would remain in a steady and stable state—that we would not have any deterioration. We want a similar commitment for 1995–96.

On the three passenger rolling stock companies, we need to know what is at stake and how the bids will be considered. Are there serious bids and, if so, how many? Why does the Secretary of State think that there are so few? Can he confirm that the whole British Rail passenger fleet—coaches, locomotives, high-speed trains and diesel and electric multiple units—could be sold for as little as £1,300 million? What will be the expenses of that sale?

The House might be interested to know that the Government are engaged in the sale of a whole fleet for about the same sum of money as would be required to renew the fleet of just one train operating company—South East Trains is expected to need about £1,600 million and it serves only the county of Kent.

Rolling stock companies are likely to become unregulated private monopolies. No spare rolling stock will be available. They will simply be interested in short-term profit. If the Government agree leases of just eight to 10 years and guarantee 80 per cent. of that income, train services will simply come to a halt. There will be no spare capacity and there will be real difficulties.

In selling off the passenger rolling stock companies, the Government have stitched up a deal to get some money into the Treasury's coffers to contribute to pre-election tax bribes, without ensuring that there is a fully effective competitive environment. There is no commitment on the part of purchasers to invest any of the rental moneys in new rolling stock. There is no guarantee of improvement. Privatisation is nothing to do with enterprise or competition but is straightforward asset stripping—selling the family silver for a few coppers.

As the hon. Member for York (Mr. Bayley) said, there will be no new orders for rolling stock. There will be no salvation for the beleaguered companies that supply rolling stock manufacturers, let alone for ABB itself. The hiatus in investment which Ministers said would not happen has arrived, is getting worse and will continue. We need commitments from Labour on that matter too.

Liberal Democrats envisage a busier railway which will require new rolling stock and an end to the fares policies that drive people away from the railways, not only in extreme examples such as south Devon but in many other parts of the country.

We believe that the rolling stock companies should be given a choice after the general election. They should be invited to become partners in a plan to expand the railway and submit themselves to a licensing regime to control costs and quality. We would ensure that they would be encouraged into new long-term franchise deals which would exclude the leasing companies, which would find themselves with a great deal of aging rolling stock and no financial basis on which to extend its life.

We do not think that taxpayers' money should be poured into the pockets of unregulated monopolies. We hope that hon. Members on both sides of the House accept our position. The rolling stock companies could become what I have described. We want to ensure that those companies are made to face genuine competition in supply and that their leases will not be extended or renewed on existing terms if they fail in that respect.

In our debate on 11 July, we covered a number of other aspects of rail privatisation. With your admonition ringing in my ears, Madam Deputy Speaker, I do not propose to go back to them. However, as the Labour party initiated this debate, we want this evening to hear it endorse my last point and give a commitment on the future control of Railtrack. In the meantime, our constituents—the passengers, the travelling public—are suffering from an investment famine not only in respect of rolling stock but in respect of retracking, resignalling and basic track maintenance.

We have heard already of the number of instances where speed and weight restrictions have been imposed—for example, right the way down the Great Western and especially in my county of Cornwall. It is only a matter of time before such restrictions and the investment famine results in a disaster. A tragedy could well be in the making already. As my correspondent pointed out, the Maidenhead crash showed how near we have come to dangerous overcrowding. Safety may, in the Secretary of State's words, be paramount. If it is, the best way that he can serve that objective is to postpone the privatisation of Railtrack.

On a point of order, Madam Deputy Speaker. You will be aware that Madam Speaker earlier this afternoon reserved her ruling on the implications of the European Court of Justice judgment which outlawed the employment of women by quota. Reports are running around Westminster that three Labour Members have applied to the courts for relief because of the way in which the shadow Cabinet elections were arranged.

There is also a report that the hon. Member for Blackburn (Mr. Straw) may be involved since he lost his national executive committee place because of quotas. This clearly touches on some matters relating to privilege. Can you confirm whether those reports are true?

I cannot confirm whether they are true. Whether they are true or not, I cannot see that they are a matter for the Chair.

5.32 pm

In the light of what has been said about the need for short speeches, I intend to be brief. The hon. Member for North Cornwall (Mr. Tyler) said two things with which I entirely agreed; with the rest of his speech I entirely disagreed. First, I entirely echo his genuine tribute to you, Madam Deputy Speaker. We all wish you well and are sorry to hear that you do not intend to continue in the House beyond the next general election.

I also entirely agreed with the hon. Gentleman's reference to bones being tossed to the jackals of the Labour party at its conference in Brighton. That is something that we have all witnessed in the past and have now seen again. For the hon. Gentleman to suggest, however, that anything at all could happen in response to his own party conference is laughable. I recall that the main news item of the week related to a goldfish at No. 10 Downing street and not to anything that was said at the Liberal Democrat conference.

I want to concentrate on the policies of the Labour party and its lack of firm commitments. Its approach to rail privatisation has degenerated from what was at best a policy of hit and miss to one of scare and miss. In considering rail privatisation, we must examine what services are to be offered to the passengers—the customers. I have spoken on this subject before and I said that the acid test of the involvement of the private sector in running rail services is whether there will be better customer service.

What do we find? We find that the current agreements between Railtrack and the first three franchises have already created between 13 and 20 per cent. more capacity than was needed to deliver the timetable at present in force. In a press release on 31 January, Mr. Bob Horton, the chairman of Railtrack, said:
"This will ensure that they"—
the first three franchise operators—
"are able to run present service levels, and give them space to step them up."
Contrary to Labour party scare stories, the train operators have made it clear that not only do they have no plans to reduce existing service levels but many are planning to increase them. For example, South West Trains has found 20 per cent. more capacity. Its press release of 31 January this year states:
"We plan further new services … a new fast service between Waterloo-Guildford and Portsmouth, the Guildford Shuttle; extra trains between Ascot and Reading—providing four trains an hour; and new through services between Waterloo and Horsham and extra trains between Waterloo and Epsom."
Great Western Trains has found 18 per cent. more capacity. Its press release states:
"The timetable plan …maintains the current level of services and consideration is being given to the introduction of additional ones."
For many years before coming to the House, I commuted on the London, Tilbury and Southend line and its progress has already been referred to by my hon. Friend the Member for Castle Point (Dr. Spink) in his excellent speech. Its press release states:
"LTS Rail introduced additional off-peak trains … Completion of the £150 million LTS resignalling project in 1996"—
to which my hon. Friend the Member for Castle Point also rightly referred—
"will provide further opportunities to encourage car users to switch to LTS Rail. We have negotiated a track access contract which provides scope for this".
Let us consider other railway lines with which I am familiar. A press release from the director of ScotRail, Mr. John Ellis, in May this year stated:
"ScotRail is committed to expansion of the services we offer our customers. This is confirmation that contrary to constant speculation, no routes in Scotland are under threat and provides for the first time a longer term commitment for the continuity of services."
A press release from the finance director of Midland Main Line, Mr. Geoff Evans, states:
"Midland Main Line is a commercial organisation and recognises the need to provide the level of service that customers demand and we will continue to strive for these levels of service.
Constantly monitoring needs, we continue to make alterations to improve our service such as the recent introduction of later trains both to and from London."
We can see that, contrary to the myths and scare stories of the Labour party, services are being improved for customers and passengers. That is the acid test, the proof of the pudding.

The Labour party has deliberately and consistently sought to mislead the House and the country about the passenger service requirements. It ignores the fact that, for the first time. in the history of railways, the passenger service requirement introduces a guarantee for customers—an irreducible minimum below which no service will ever be allowed to fall. Never in the history of railways, private to 1948 or nationalised since, has that existed. It is this Government who have introduced it as a guarantee for passengers and customers.

That is why I remain confident that privatisation will continue to produce ever more benefits and improvements in services for customers. I travel regularly on the west coast main line and was delighted to hear my right hon. Friend the Secretary of State confirm yet again the Government's commitment to upgrading that line and improving services on it.

Privatisation will undoubtedly result in access to private capital for investment, which the railways will continue to need. It is only through access to private capital that such investment will be made. The Labour party would not be allowed to write blank cheques, as its leader has repeatedly made clear. That is why the hon. Member for Oldham, West (Mr. Meacher), who opened the debate for the Labour party, was not prepared to make any such promises.

Weasel words have been used to suggest to the rail unions that promises have been made in order to try to guarantee their support. It is not surprising that the Labour party continues to be dominated by the rail and other unions when no fewer than 186 Labour Members are sponsored or supported by trade unions. I went through the list of those sponsorships and saw that no fewer than 50 Labour Members are sponsored or supported by transport unions. A list of shadow cabinet members—at least, the current shadow cabinet until later tonight—is sponsored or supported by rail unions.

Once again, the Labour party is in the pocket of the producer culture—the trade unions—bought and paid for. They do not speak for the customers or passengers but continue to speak for the union barons who control Labour, as they have always controlled Labour and will continue to control Labour. The Labour party is interested not in passenger or customer service but in its union paymasters and bosses. The public at large and the travelling public will have no faith in the scare stories and myths put out by the Labour party.

5.41 pm

I have been a little surprised by the tone of this debate. I do not know the seat of the last speaker—[HON. MEMBERS: "Blackpool, South."] It might have been more appropriate if he were the hon. Member for the planet Krypton because he is certainly not from the same planet as me and does not represent the same views as I hear from my constituents. I shall deal with one of his points by saying that I am sponsored by the National Union of Rail, Maritime and Transport Workers, which is one of the railway unions. I am proud of that and glad that the hon. Gentleman was able to look at lists and see the interests of every Labour Member. I should like to see a list showing Conservative Members' business interests, but unfortunately Conservative Members have consistently tried to block such openness.

I was also surprised that the Liberal Democrats tried to turn this debate into a political point scoring match. We are discussing the country, not party political views, and they have made cheap shots. I am not waiting for my hon. Friends the Members for Oldham, West (Mr. Meacher) or for Fife, Central (Mr. McLeish) to make a commitment to return the railways to public control because we have already had that commitment at conference, and it came from neither of those two hon. Friends but from the leader of the Labour party. He made a commitment that the railways would be returned to public control and be publicly accountable, and that is good enough for me. Hon. Members may sneer and try to twist things round, but the commitment effectively exists. When it was made at conference, I saw that Jimmy Knapp was as delighted as I was, and I am certain that the majority of people in the country were also delighted.

While I do not expect it from Conservative Back Benchers, I expected much more sympathy and empathy from the Secretary of State. We have seen recent reports of overcrowding on trains and commuters literally scrambling for seats. Given that the Secretary of State and the Minister for Railways and Roads have spent the past few months scrambling for a seat in terms of parliamentary selection, I thought that they would empathise with commuters.

Rather than abuse the time available as others have, I shall try to keep my speech short and sweet. I sat on the Committee which discussed the Railways Bill, where many assurances were given about what would happen in the privatisation process. Many of my hon. Friends feel that, during the passage of the Bill, we were, if not deceived, at least misled about what would happen. I do not feel that we were misled.

I am not trying to be charitable to the Ministers involved. I recognise that the current Secretary of State and the Minister for Railways and Roads are new boys and I do not wish to make them the villains of the piece, but there is plenty of evidence that their predecessors made commitments on which they have reneged. For example, during the passage of the Bill, the privatisation of Railtrack was not discussed. It was simply not on the cards. We knew nothing about it until, last October, the Secretary of State for Transport suddenly announced that Railtrack would be privatised. So we had no proper debate about that.

After a great deal of pressure, commitments were made on through ticketing and we were told that it would be protected. Then, in the past year, the Government proposed to reduce the number of stations that could sell through tickets. Of the 2,500 stations which currently exist, 1,300 are staffed. We were told that 294 stations would be allowed to sell through tickets, which did not rule out through tickets but meant that nobody could get hold of them. Luckily, because of the prompt action of Labour Front-Bench Members and others who brought the matter to the public's attention, that proposal was dropped.

We were given guarantees about passenger services and told that they would be kept at current levels. Although Conservative Members say that under the passenger services requirements we have been guaranteed a minimum number of trains for the first time, that minimum is 15 or 20 per cent. below the current number so it is not much of a guarantee. After a great battle, we were reassured that there would be free competition and were told that British Rail could bid for franchises. However, when the first three franchises were put out, the Secretary of State excluded British Rail from bidding.

I am an ex-railway employer—I mean employee. The way things are going, I may be an ex-railway employer in the future. I remember when we had a system called "Organising for Quality", when the railways were split into business sectors. It was called "O for Q". I say that carefully because at the time it was a standing joke within the rail industry that "O for Q" was what the Government and British Rail's management thought of their customers and work force. We were suspicious that the railways were being prepared for privatisation. Happily, and unhappily, I was wrong about that.

In some respects, I can understand that, if a Government plan to privatise something, that is a legitimate policy and, although I may not agree with it, they have the right to pursue that policy. However, the Government have not considered the way in which the industry works most effectively. Had the privatisation been done by business sector or by breaking the railways down into geographical areas or regions, one could see some logic in it. But rather than privatise the railway so that it can operate more effectively within the private sector, the Government have simply sought to sell it in the easiest way without considering how it will operate afterwards. Remarks by the Secretary of State and some Conservative Members have proved that, to them, success will be achieved if they manage to sell it all. To me that is nonsense.

I believe that the attempt to pass the railways into the private sector will fail. Should it succeed, however, we should try to ensure that they operate in the most efficient and effective way within the private sector. The hon. Member for Castle Point (Dr. Spink) may talk about the objectives of privatisation, but the big problem for me is that the only objective I can see is that of selling off the railways.

When I served on the Railways Bill, a chart was used to show how the responsibilities, financial arrangements and safety requirements of the various proposed companies would fit together. Even before the creation of Railtrack, involving 12,000 employees, 5,000 of them signalmen, I remember describing the proposals as a cobweb of confusion because it was impossible to tell who would be responsible for finances, operational measures and safety. The scenario is even worse now, because we are talking about 25 train operating units which will become train operating companies, three rolling stock companies which will lease stock, three new freight companies, a regulator and a franchising director. One can see how the confusion will become worse and worse. Without clear lines of responsibility and communication, all that we have is a recipe for disaster.

We need look no further than the events of the past two days to understand the importance of clear lines of responsibility. The arrangements between the Home Secretary and the Director General of the Prison Service appear to be straightforward, sensible ones. The Home Secretary is at the top, and below him is the director. Even in that simplified structure, however, it seems that they could not agree about who should make the decisions. Once we have 100 different rail organisations working independently, who will then decide who is responsible for them? We are talking about thousands of licences being issued as well as thousands of legal agreements between different organisations. What is on offer is a dream for accountants, consultants and solicitors, and a nightmare for the rest of us.

I believe that among Conservative Members there is a significant minority—perhaps not counting those who are present—who recognise that the rail privatisation proposals are a disaster. During the passage of the Railways Bill, I realised, as I am sure many others did, that Ministers were saying things with tongue in cheek. They knew that it was nonsense and they did not believe in it. In some ways the previous Secretary of State for Transport inherited that Bill. He got so used to repeating nonsense, and did it so convincingly, that it made him eminently qualified to become chairman of the Conservative party.

One of the Ministers responsible for driving the Bill through was the Minister for Transport in London, for whom I have a great deal of time: he is witty and I enjoyed working with him on that Bill, as I have done since on local transport projects. He has always been helpful, but after spending all that time working on the privatisation of the railways, what does he plan to do? He plans to go off and sell cars. If I had made such a shambles of the railways as the Government have done, I think that I would go off and sell cars as well.

The privatisation proposal gained little initial support except from within Conservative Central Office. Hardly anyone was in favour of it then, and even fewer people want it to go ahead now. As a result, morale within the railways is at its lowest level ever and investment in the industry is at its lowest level for 20 years. Hon. Members do not need to believe me because one does not have to do a great deal of research to confirm that what I have said is true.

Just this Monday, The Guardian quoted not a rabid socialist like me, who is intent on keeping the railways under public control, but the chairman of the Rail Users' Consultative Committee, Major General Lennox Napier—the Conservatives have not managed to replace him yet—who can hardly be described as a hero of the left. The article reported:
"He said investment had never been lower for 20 years. Until 1993, it was running at around £1 billion a year, but it is now down to £400 million."
He said that infrastructure was deteriorating and that up to 85 per cent. of delays were caused by infrastructure failures such as poor signals. He also said that there were now 2,600 fewer coaches than there were six years ago.

Investment in rolling stock is important. When we first started our discussions on the Railways Bill, there was a great deal of talk about competition. Now there is no competition between public and private or between private and private because no coaches are being built. It does not matter whether we are talking about ABB Transportation or GEC Alsthom: there is no competition between them now because they are united in telling the Government that they want any sort of order, but no orders have been made for this year or the next. When one appreciates that such orders have a two-year running period, it is clear that there will be no orders for the next few years.

Unlike the Secretary of State for Defence, I would not describe myself as a little Englander. In a few years' time, when we have a more sensible transport policy under a Labour Government, we shall put money into building rolling stock, but I fear that by then we shall have lost not one coach manufacturing job to Europe, nor even 100 or 1,000 jobs—we shall have lost an entire industry. It will have disappeared because of the Government's short-sighted view.

Given the Conservative Members in the Chamber, I fear that my request may fall upon deaf ears. Nevertheless, I ask those with some honesty and integrity to recognise that the privatisation proposal is nonsense. I do not ask them to take the more drastic course adopted by one of their ex-Members by crossing the Floor, but I hope that when it comes to the vote they will cross into a different Lobby. I hope that they will put common sense above dogma and put commuters and their constituents above Conservative Central Office. They should put the country above their party because that is what the debate is all about.

5.57 pm

When the hon. Member for Newham, North-West (Mr. Banks) presented his ten-minute Bill earlier today, he said that it was supported by a list of the "usual suspects". Today's attendance is rather like that of the usual suspects for any rail privatisation debate.

I am particularly pleased to see that one of those suspects is the hon. Member for Hampstead and Highgate (Ms Jackson), who is sponsored by the Associated Society of Locomotive Engineers and Firemen. One of her most celebrated roles before she joined the House was as the Queen who died with the name of Calais engraved on her heart. Perhaps it was over-identification with that particular role that sent her to Dover today—

On a point of order, Madam Deputy Speaker. The hon. Member for Evesham is misleading the House. I have never played the Queen who had the name of Calais carved upon her heart.

I thank the hon. Lady for making that point, which was one of information and not a point of order. I suffer from that practice; if we were all to try to correct what other people say we would never get to the end of any debate.

My knowledge of history and literature is as grievous as the hon. Lady's knowledge of geography, because I am the Member for Worcester, not Evesham. I apologise profoundly to the hon. Lady if I got the literary and historic reference wrong; it was a fine role none the less.

I believe that the hon. Lady can at least confirm that she went to Dover today to oppose the privatisation of the port on the grounds that she is scared that the port might be bought by the people of Calais. As far as I am concerned, all that she was doing was trying to rob the port of Dover of the advantages of privatisation which have accrued to the other privatised ports of the United Kingdom. I believe that she will try to catch your eye later, Madam Deputy Speaker, when she will seek to do the same things to the railways of the United Kingdom, seeking to rob them of the advantages that will accrue from privatisation.

Another of the usual suspects is the hon. Member for North Cornwall (Mr. Tyler), whose debate on the rail network on 11 July was not much better attended by Opposition Members than is today's debate. It makes me wonder how passionately they feel on the subject. There were no more Opposition speakers then and there were no better arguments. It is not surprising, really. The Opposition cannot duck the simple fact that they have opposed every privatisation so far, and that every privatisation so far has resulted in improved customer service.

It was obvious from the speech of the hon. Member for Oldham, West (Mr. Meacher) that he had no faith in the customer to take decisions about what was in his or her best interests, or in the private sector to take decisions about what was in the best interests of the people whom they sought to serve. His faith reposed entirely in the state knowing best. Old Labour is alive and well in Oldham, West.

Transport privatisations have been especially successful. That is what makes me so sad.

We have heard many times in the House—but they are worth repeating—the comments of the hon. Member for Glasgow, Garscadden (Mr. Dewar) about the privatisation of British Airways:
"It will be the pantomime horse of capitalism if it is anything at all."—[Official Report, 19 November 1979; Vol. 974, c. 125.]
We now know how wrong that prophecy was. British Airways carries more international passengers than any other carrier—about 6 million more than its nearest competitor in 1993.

The extent of the success of those transport privatisations makes me especially delighted that Worcester will be among the first stations in the country to benefit from the first round of franchise awards, when the Great Western main line services are privatised in the first batch of franchise awards.

I am saddened by the fact that Opposition Members appear to believe that we do not share their genuine anxiety—although so many of them are supported by the rail unions, somewhere under that there is a genuine concern for the passenger—to improve the lot of the travelling public. We cannot stand by and watch the continual decline of the railways, whose share of all passenger journeys in Britain has decreased so sharply since the nationalisation of the railways after the last war. That decline is the result of many factors, but I am convinced that chief among them has been the stultifying effect of nationalisation.

Speech after speech and article after article by the hon. Member for Oldham, West promises a renaissance of the railways. It makes a great soundbite, but what does it mean? What happened after 1948 when Labour was the Government responsible for the railways? What happened between 1964 and 1970? What happened between 1974 and 1979? No renaissance of the railways there.

Conservative Governments have found it difficult too, labouring under the shackles of nationalisation. The time has come for a new approach to the railways, to reverse that tragic relative decline.

I am not one of the people who believe that everything is wrong about the railways—far from it. I use them as much as possible, although, sadly, that is not as much as I should like. I am always impressed by the punctuality of the services. If only, I repeatedly say, I could reach my destination as reliably by car as I can by train. I am impressed by the commitment of British Rail to care for disabled people. It has an outstanding record in that regard.

However, we cannot allow the decline in market share to continue. That is the ultimate touchstone for any business; if it is losing market share, it is failing. The Government's proposals seek to put right that failure.

The speech of the hon. Member for Oldham, West had many echoes of an article in the current edition of Railway Magazine—long on cliché and mockery, the politics of destruction, but short on understanding, vision and practical solutions. I especially regretted, in his speech and in the article, his shroud-waving over safety on our railways—shroud-waving that has been repeated by the hon. Members for Crewe and Nantwich (Mrs. Dunwoody) and for North Cornwall.

It is worth reminding people the facts about rail safety, not the myths. The independent Health and Safety Commission confirmed that there is no evidence of any overall decline in health and safety standards since the reorganisation of the railways in preparation for privatisation. Railways are one of the safest means of transport—possibly the safest means of transport—and serious train accidents are very rare indeed. Total fatalities on the railways in 1993–94 are the lowest ever recorded.

One rather complicated statistic is worth repeating. A passenger needs to travel more than six hours by rail to risk a one in a million chance of serious injury or death, five hours by air, two and a half hours by oach—still a very safe form of transport—only 30 minutes by car and a minute by motor cycle. I do not have the figures for push-bikes, so the Secretary of State can sleep easily in his bed tonight.

Rail travel is supremely safe, and it is not only the passenger that is safe. In his most recent annual report, Her Majesty's Chief Inspecting Officer of Railways acknowledged that, in 1993–94, the railway coped with organisational change while achieving the fewest ever passenger deaths and work force fatalities. The railways are profoundly safe.

The hon. Gentleman is quoting rather selectively from the reports. A briefing given to me by the Library tells me that, between 1993–94 and 1994–95, deaths from railway accidents increased from 14 to 15, major injuries increased from 46 to 69 and derailments from 113 to 149. He paints a rosy picture by choosing those figures that support his argument rather than looking across the board.

I am profoundly disturbed by that intervention. I thought that the hon. Gentleman sought to promote investment in the railways. There he is again, promoting fear of rail travel. If I heard those figures correctly—I am not sure that I heard them entirely correctly—he spoke about an increase in fatalities from 14 to 15. Is that correct?

I spoke about that figure, the increase in major injuries from 46 to 69 and the increase in derailments from 113 to 149.

After the debate, the hon. Gentleman and I will together go to the Library and find out how many people are killed and injured on the roads of Britain in accidents. I bet that we find that, each and every day, more people are killed than those figures. Those increases, although regrettable—I do not want any increase—remain tiny and the railways remain one of the safest ways of getting from A to B that one can devise.

I am profoundly disappointed that the hon. Member for York, who rightly wants people to invest more in railways, should suggest that the railways are becoming more dangerous when it is transparently obvious that they are not from the very figures that he quoted.

The article by the shadow Transport Secretary, the hon. Member for Oldham, West, is littered with pejorative and inaccurate statements. I despair that a transport spokesman can write such an article.

I have some sympathy with one argument in the article. The hon. Gentleman speaks about the relatively short length of franchises. I believe that there would have been some advantage in having franchises longer than seven years. Apart from anything else, if, by some dreadful misfortune—which I do not think will befall the country—there were to be a Labour Government, the period of the franchise would carry on beyond the time of the Labour Government and could be renewed by the next Conservative Government. However, I believe that it is a hypothetical worry.

What about the claim that we have made a shambles of services to the passenger? The hon. Member for Oldham, West is not in the Chamber, but I shall happily invite him to come to Worcester and look at the services to passengers in my area, which are steadily improving, as I shall show him if he intends to come. I shall discuss that later.

The hon. Member for Oldham, West commented about passenger services requirements—an issue also mentioned by my hon. Friend the Member for Blackpool, South (Mr. Hawkins). The comment that the hon. Member for Oldham, West made was a profoundly dishonest misrepresentation of the truth when my constituents, for the first time ever, have a guarantee about rail services. I believe that there is even a guarantee on the sleeper services to Cornwall that so worried the hon. Member for North Cornwall earlier. The guarantee that those services will run has never existed before. It is not a specification but a guarantee.

As you, Madam Deputy Speaker, know, the service between the west country and Scotland, far from being guaranteed, has actually been removed.

I was, of course, referring to the service between London and the west country. If I remember rightly, it is now being run from Waterloo to enable better connections with the Eurostar services, which should make it still more attractive.

I am pleased that my hon. Friend has given way. He may be unaware that one of my regular trips to the Department of Transport to visit my hon. Friend the Minister of State's predecessor was made in order to plead the case for the sleeper. We had deep discussions with British Rail, which could at no stage guarantee the sleeper service for more than five or six months at a time. The point that must be made is that for the first time the sleeper service is now enshrined in a mechanism that will guarantee it for the next seven years. We could never have had that guarantee under the existing system.

And that is one of the great advantages of the privatisation process. I thank my hon. Friend for his comments.

In the article, the shadow Secretary of State for Transport talks about job cuts, which are always regrettable. I do not welcome redundancies, but I am left with the uncomfortable feeling that the hon. Gentleman still feels that the railways are being run for the benefit of those who work for them, not for the benefit of those who use them. It drives me back to my deeply held conviction that the Labour party remains driven by producer interests. The secret deals that it now seems to be doing with the unions in the event that it should ever gain power further reinforce that view. Of course we want to see a vibrant railway industry. I want employment in the railway industry to increase as more people use it. But I do not want the railways to be used as a job creation scheme which would increase taxes and fares.

In the article we also read about one of Labour's old canards. The hon. Member for Oldham, West states:
"Privatisation will break up the railways into no less than 94 separate units, all competing, contracting and co-operating with each other simultaneously.
Every station with more than one operator will need more than one timetable"
I honestly do not think that the hon. Gentleman understands the complexity of the status quo. Just because a huge, bureaucratic monolith is running the railways it does not mean that they are run efficiently or that there are not agreements between the operating units and the railways.

I again ask the hon. Gentleman to come to Worcester. I have in my hand the five timetables that I presently have to contend with in Worcester—not under a privatised railway. They are the timetables that we have had year in, year out in Worcester under British Rail. I hope that a privatised railway will consider the subject and decide that it would be easier for passengers if all the timetables were put into one booklet. I hope that the privatised railways will co-operate with each other to produce a single booklet. What I have in my hand is the product of a unified British Rail, not of the 94 units of which the hon. Gentleman speaks.

Later in the article, the hon. Gentleman mentions an issue that was discussed at great length when he was still in the Chamber. He states:
"Leaked documents are particularly welcome. I promise to make good use of them"
I wonder whether that gives the game away for Labour. First, it proves that the Labour party is unfit to govern because it encourages civil servants to leak. If ever the Labour party formed a Government it would find how impossible that makes it for a Government to conduct a rational discussion of the issues. Secondly, perhaps it is because the hon. Gentleman knows in his heart of hearts that Labour never will form a Government that he is so anxious to encourage the leaking process to continue.

Under the direction of the hon. Member for North Cornwall the debate moved on to the issue of what Labour intended to do if by any misfortune it ever gained power. In the article the hon. Member for Oldham, West said:
"Labour believes in a publicly-owned, publicly accountable rail system. If the Tories push through this idiotic policy and complete the sell-off, we will rebuild a public railway during the life of the next Labour Government."
How? What will they do? We are all in the dark. None of us has the slightest idea, least of all the Labour party.

May I draw the Labour party's attention to an editorial in a newspaper that urged the Labour vote at the last election—so it is no friend of the Conservative party. On Thursday 12 October the Financial Times states:
"The starting point for both sides should be the needs of the passengers and freight carriers whom the railway exists to serve. This rules out any return to the status quo ante, which was chronically inefficient and could not in any event be recreated without massive, debilitating upheaval.
The opposition parties appear to accept this, which makes their renationalisation commitment bizarre as anything other than a cheap electoral gimmick. In practice, it appears that Labour will follow the Liberal Democrats and interpret 'state control' as meaning a majority stake in Rai1track. Mr. Tony Blair would be foolish to pledge any more if he has any regard for his 'tax and spend' reputation … Any renationalisation commitment will create damaging uncertainty for Railtrack's management. But far more problematic is the future subsidy regime for the network … The cry for subsidies will not be reduced when the trains are privately operated"—
although the hon. Member for Oldham, West threatens, bizarrely, a reduction in subsidy to privatised operators, and I simply do not understand his logic—
"particularly if transport policy …remains so heavily weighted against rail use."
I believe that it is weighted in that way, which is what privatisation should address.

Perhaps the Leader of the Opposition dare not say publicly what he intends to do about the railways for fear of upsetting those very unions that sponsor so many Labour Members.

My hon. Friend referred to the excellent quote from the Financial Times and the importance of getting freight back on to rail. Does he agree that one of the chief faults of the nationalised railways since 1948 is that they have consistently taken freight off rail? There has been more and more waste in the use of resources.

One of the chief benefits of privatisation will be a private sector organisation dedicated to getting freight back on to rail.

I could not have put it better myself and I entirely agree with my hon. Friend. I am confident that one of the many advantages will be an increase in the share of freight traffic using railways, in particular using the access to continental markets through the channel tunnel.

Four key advantages of privatisation have come through in today's debate. First, the individual railway companies will become more responsive and accountable to their customers, which is what matters, not to a Secretary of State sitting in Marsham street, worried about juggling figures between education, health and railways. They will be responsive and accountable to their customers. They will offer an improved service to their customers, not a worse service, which they have no interest in providing.

The railway companies have fixed costs and, to reduce them, they will improve the service and get more people on to the railways. They will do so largely through the better marketing of services. Only about 7.5 per cent. of our constituents ever use trains. The other 90-odd per cent. do not. Half of them do not even know how to use trains; they do not what trains go where or when; they do not understand the railways, which are almost a closely guarded secret within the railway establishment. We need to break out of that secrecy with private sector marketing skills and with access to private finance.

We have seen the promise; we have seen what is to come. We saw the privatisation of On Board Services. A newspaper stated that a spokesman for the company said:
"In the future, passengers could find a hot meal, prepared on board and delivered to their seats, included in the ticket price. `You're going to see an increase in customer service,' he said. A range of new products will also be introduced."
That is what railway privatisation will do—it will provide a better service and more people will use it. I commend the privatisation to the House.

6.16 pm

The hon. Member for Worcester (Mr. Luff) referred to myself and my colleagues sitting on the Labour Benches as "The Usual Suspects". One good film title deserves another and everything that we have heard emanating from the hon. Gentleman's colleagues on the Conservative Benches could justifiably be defined as "Pulp Fiction".

The hon. Member for Worcester mentioned the visit that I made today with my hon. Friend the Member for Stoke-on-Trent, North (Ms Walley) to Dover. He made two correct statements to the House. First, in common with my hon. Friend the Member for Nottingham, East (Mr. Heppell), I am proud to be sponsored by a transport union—in my case, the Associated Society of Locomotive Engineers and Firemen. We were campaigning in Dover against the Government's proposed enforced privatisation of the Dover port.

The hon. Member for Worcester was markedly lacking in information—not only of a literary and historical nature—about what has motivated that campaign, over and above the Government's attempts to impose yet another privatisation. The people, the public, the citizens of Dover—those who live and work there—are utterly opposed to the privatisation. It is not only the citizens of the town, but the people who use the port, the businesses, the chamber of commerce, the mayor of Dover and the mayor of Deal who are totally opposed to the privatisation.

In a nutshell, the pulp fiction that we have heard emanating from the Conservatives is that the Labour party is opposed to the privatisation of the railways because we are not concerned with the public interest while Conservative Members are committed to privatisation because they have the public interest at heart. Every poll conducted in this country since the Government set off on their benighted journey of railway privatisation has proved overwhelmingly that the people of this country reject the idea of rail privatisation because they know that, far from expanding and improving railway services in this country, it will destroy them. They are already seeing that such services as they have are deteriorating.

Last year, the report on the requirements laid down for railways under the citizens charter showed that, within those seven franchise networks, there have been increases in the number of cancellations. Increasingly trains fail to reach their destinations on time. Over-arching the arguments about rail privatisation is the salient point—that everyone except Conservative Members seem to have taken on board—about the environment. People in this country and throughout the world are recognising that over-dependence on forms of transport that require petrol-driven engines is leading to the destruction of the environment in our local communities and possibly the world.

Yet the Government are presenting the idea of rail privatisation as a means of enlarging and enhancing the use of our railways. The system would mean the destruction of our railways. As my colleagues have pointed out on more than one occasion, the Government's much-vaunted guarantee of minimum service guarantees a service that is infinitely less and, in many instances, infinitely more expensive than the previous one.

I recently had the privilege of being invited to address the annual conference of the National Association of Rail Users, which was held within the confines of my local authority last weekend. Representatives from every corner of these islands attended the conference and each and every one of them provided anecdotal evidence about the reduction in their rail services since the Government set out on that benighted track. The representatives are passionate about their desire to use the railways, to encourage others to use them and to see an expansion of our railway system. Every delegate, without fail, said that the Government's privatisation plans would not secure the expansion of our rail network.

There has been much talk about the need for additional investment in our railway system, and no one would argue with that. However, I think that Conservative Members have been less than direct in making it clear to the House and to the country that privatisation has so far brought no new money to our railway system and that no new money will be introduced via the franchises when they are up and running.

The Government have spent £1.25 billion of taxpayers' money in an attempt to bring about privatisation, without investing one penny piece in our railway network. The Government are spending £25,000 per day on lawyers' fees alone in their attempt to privatise our railways. That money would have been much better spent laying new track, buying new rolling stock, improving signalling and ensuring that safety measures are adhered to.

No one in this country—apart from Conservative Members—wants or believes in rail privatisation. Earlier today my hon. Friend the Member for Nottingham, East (Mr. Heppell) urged Conservative Members if not to cross the Floor permanently, at least to join us in the Division Lobby tonight. I join him in that call.

6.23 pm

Conservative Member after Conservative Member has risen in the debate to say that every privatisation that has taken place under the Conservative Government has been a success. I remind them of one early rail privatisation—the privatisation of British Rail Engineering Ltd. five years ago—which was hardly a success.

Five years ago, the British Rail carriage works in York employed 3,000 people. By the time of the last election, that figure had decreased to 1,650, and by the end of the year no one will be employed there. ABB invested £50 million in the York works on the basis of the Government's indications about likely investment by railway companies in new rolling stock. However, that investment never came, and the factory closed.

Those who are considering buying into the operational parts of the railway should think about it very carefully. The Government may be guaranteeing them future streams of income, but prospective buyers should recall what happened to the rolling stock manufacturers: they invested heavily, only to be dumped by the Government. The work force were dumped by the Government and the workers' Christmas present this year will be unemployment.

This summer, I tried to stick to my resolution to boycott all things French as a protest against French nuclear tests. However, I was stranded for a night in Strasbourg while on my way to a family holiday in Switzerland. I had not visited Strasbourg before. It is a beautiful city and it is easy to travel around on the magnificent modern tram system, which was opened recently. The trams were built in York in my constituency—it is written on the side of the trams. An efficient factory in York beat off the French competition and won the contract. However, when the tram system in Strasbourg is expanded, the new trams will not be built in my constituency because the factory will no longer be there. That is one result of the Government's policy.

The Government have invested a little in new rolling stock: they let a contract to the German company Siemens. If the contract had been let to a British company, the jobs would have stayed in this country and we would have retained the ability to manufacture trains in this country, but the Government have thrown away that chance.

If rail privatisation were such a rip-roaring success, the Government would be publicising it; instead, they are complaining about leaks. Confidential advice given to Ministers is that rail privatisation is a disaster; it is not working. So, instead of encouraging openness, the Government have shrouded the privatisation process in secrecy.

The answer to a parliamentary question asked by me appears in Hansard of 9 February 1995. I asked the Minister for Railways and Roads, who is now in the Chamber, to publish the Hesketh report into BR signalling, but he refused to do so. I congratulate the Transport Select Committee on its persistence in using its powers to call for documents to be provided and, as a result, a copy of the Hesketh report has come into the public domain.

Hesketh was commissioned to conduct a study of the signalling system throughout the British Rail network following the Clapham rail crash and to implement recommendation No. 49 of Sir Anthony Hidden's report, which stated:
"BR shall develop an adequate system of allocating priority to projects to ensure that safety standards are not compromised by delay".
The Hesketh report on signalling listed 95 renewal schemes that were required around the country in order of priority and set a "latest start date" for each of those schemes. Some 13 schemes, estimated to cost about £170 million, had "latest start dates" in 1993, 1994 or 1995.

The Hesketh report is the bible for signal engineers and its importance was reiterated by John Edmonds, chief executive of Railtrack, in his evidence to the Transport Select Committee. He described the Hesketh report as "the base document" from which signal engineers worked. He went on to state:
"We are spending at a level which entirely fits the sequence which Hesketh originally proposed".
Mr. Edmonds was clearly trying to give members of the Committee the impression that they did not need to worry about the Hesketh report because the work was going ahead. However, he misled the Committee. If one compares the detailed recommendations in the Hesketh report with the Minister's answer to a parliamentary question that I asked on 26 April, one finds that three quarters of Hesketh's top 13 schemes, which should have been started this year, are running behind schedule or have simply been shelved altogether by the Government.

I shall give the House an example. The Hidden report into the Clapham crash said:
"British Rail shall …ensure that all working drawings are complete and an accurate representation of the system to be worked on".
In the report on the Kingmoor relay room in Carlisle, Hesketh says:
"Wiring diagrams have inconsistencies with the site installation".
He continues:
"There is high risk present at this site and work should be undertaken quickly to renew the equipment in this area".
Hesketh laid down a later start date of 1994 on safety grounds. The Minister stated in his answer:
"The programme for this project is currently under review."—[Official Report, 26 April 1995: Vol. 1686, c. 592.]
Location by location, page after page, the Hesketh report reveals glaring faults with signalling systems. Slade lane relay room in Manchester is so corroded that there is a risk to internal equipment. The Longsite No. 1 relay room in Manchester is operated with second-hand spares from Crewe. In regard to the Brewery Sidings signal box in Manchester—vintage 1894—Hesketh says:
"The cable route is destroyed at a number of sites … Cables have … core to core contacts."
That scheme is running two years behind the Hesketh timetable. Signal boxes in Scotland at Grangemouth and Carmuirs East junctions have to have their mechanical switch diamonds cooled with continuous water spray during hot weather to stop them bursting into flames. According to Hesketh, signal boxes at Stratford in east London, Forest Gate and Goodmayes have a high risk of fire.

The Secretary of State sweeps aside the recommendation in Sir Anthony Hidden's report on the Clapham crash cash that
"BR shall ensure that the organisational framework exists to prevent commercial considerations of a business-led railway from compromising safety."
He says that we need not worry about that, because the railway inspectorate will oversee what Railtrack does when it is privatised. That is an admission that Railtrack needs policing. It sadly and dangerously misses the point that a safe railway must have safety as the core concern of every structure and every worker in every rail company and rail business.

There is a conflict of interest between shareholders and safety. The Government have not resolved that contradiction and conflict. It is right to highlight the danger that rail privatisation causes. We look with interest at the new annual report of the railway inspectorate to see whether, as early figures show, there has been an increase in the number of accidents on the railway since Railtrack took over responsibility.

6.32 pm

At the Tory conference in Blackpool, the Prime Minister made a 31-page speech. Interestingly, he did not mention the railways once. I wonder why. It is clear to us that the country shares our view that rail privatisation is a monumentally stupid idea. Debates such as this have a useful purpose as they allow us to visit some reality on Conservative Members who are now outwith any suggestion of common sense and any suggestion of what passengers and the public want. They now seem destined to implement ideology regardless of the damage and distortion to our great rail network. No one should be surprised by that, because they are trying to create an artificial market where none exists.

We are delighted that the Government were animated about the leaked documents, but we take no pleasure in quoting one of the key safety experts in Railtrack, Mr. Rose, suggesting that it would take 18 months for Railtrack to be safety competent. What is the Government's response? They say that that is scaremongering. What is Railtrack's response? It is typically complacent and also says that that is scaremongering.

The Government should accept that the documents come from the heart of the industry and not from Labour party headquarters. The industry is telling the Government that it is a crazy idea. Morale is at rock bottom, there are major problems and there is a chronic lack of investment; despite all that, the Government are not listening.

On the subject of leaked documents, does that mean that the hon. Gentleman agrees with the hon. Member for Oldham, West (Mr. Meacher) who says in his article in Rail magazine that leaked documents are welcome? Does that mean that it is now official Labour party policy to encourage civil servants to breach the Official Secrets Act 1911?

That intervention suggests that I should not give way much more during the rest of my speech.

The Government want to deflect attention from what they are doing, so we are constantly asked what Labour would do. The real issue is: what are the Government doing to the rail network now? That is the subject that I want to address.

I shall give way in a few minutes when I have made some progress.

We are looking at a set of Ministers—aided and abetted by Sir Robert Horton of Railtrack—who are guilty on a number of counts. The first is grotesque misuse of taxpayers' money. By any objective analysis, something like £1 billion has been spent on the privatisation process at a time when the industry is suffering from chronic under-investment. That simply cannot be right.

Secondly, we are witnessing the mindless destruction of the rail network. The rail network works, but it is quite clear from the bureaucratic mess that has been created that it simply will not work next year. It may work the year after because, by then, we shall have a Government committed to the railways rather than to the ideology of privatising them.

Thirdly, the Government are unique in generating an unparalleled hostility to any privatisation issue. The City is negative, sentiment is weak, passengers are angry, the public is dismayed and even among Conservative supporters every opinion poll suggests that they share our view. It is simply a daft idea.

One would have thought that, faced with that, there might be some remorse at the damage being done—not at all. This evening, we witnessed the typical view that privatisation will work again because—it is alleged—it has worked in the past. That is the triumph of hope over reality.

The most punishing charge that could be levelled at the Government is that they are driving passengers towards the edge of a nightmare. In the early days of rail privatisation, the Government said that there would be network benefits. How can there be network benefits when they propose to dismember an organisation into 94 pieces and then suggest that it will all mysteriously hang together? They said that through ticketing was fine and that passengers would have the same services as before—that ScotRail would compete with South West Trains. That is a wonderful illustration of a ludicrous system. At the end of the day, the Government will not accept the premise that only passengers will suffer.

Every day, our great rail industry is subjected, in both quality and tabloid press, to ridicule through no fault of its own but through the sheer stupidity and stubbornness of Ministers.

I am grateful to the shadow Minister for giving way and I note his formidable argument for retaining a national rail network. He said that he believes that the public have a right to know, and I agree with that too. Will he give the House an explicit assurance that if the Labour party is in a position to do so and if Railtrack is sold before the general election, a Labour Government or Labour minority Government will immediately take steps to bring Railtrack under public control and public ownership again under a 51 per cent.-plus majority shareholding? The House is entitled to know the answer.

I am delighted to repeat that Labour wants a publicly owned, publicly accountable and publicly controlled railway.

We heard earlier all about the debacle with children and passengers overloading on coaches, but I am informed—sadly, this is another leak which may upset the Government, but the next part will cheer them up—that Devon county council was informed in October 1994 of what was to happen. It was given the new pricing structure and told the problems, but—surprisingly—did nothing about it.

The issue tonight, however, is the railways. There is now a crisis at the heart of our national rail network; the tragedy is that it need not have happened. We need investment, and a new way forward. Other European countries have a sensible approach that seeks to attract private capital, but also seeks a genuine partnership rather than espousing the ideological claptrap that we hear from the Government.

Let us recap briefly. I am sure that Conservative Members will enjoy being reminded of the summer of discontent that they have created on the railways. We have heard a great deal about safety. It is massively complacent to suggest that safety standards cannot be improved. I accept that rail is one of the safest methods of travel, but that does not mean that there are no risks. When a network is dismembered, there is every opportunity for mistakes to be made—and Railtrack, although charged with ensuring safety, is more interested in its flotation. I challenge Sir Robert Horton to state the real priorities of his chairmanship.

Then there is the timetable debacle. The original timetable contained more than 2,000 pages, but that was not enough: a supplement was needed, then another, and I gather that there is to be a fourth. Indeed, I believe that the timetable is so bad that it may be reprinted, as was suggested by my hon. Friend the Member for Oldham, West (Mr. Meacher). Must the public pay again? Will the debacle for which Railtrack is responsible necessitate another contribution from the taxpayer?

A further debacle involving the west coast main line would be funny, if people, industries and routes were not being harmed by the Government's incompetence. The line is desperate for finance. The Secretary of State announced today that £7 million had been gathered in from Europe. What is it for? It is simply to finance more feasibility studies. It seems that a £1 billion project is lying in tatters. [Interruption.] Ministers are saying, from a sedentary position, that that is not the case. I challenge them to tell me when work on the line will start—not the resignalling work, but the full reconstruction of the west coast main line.

I do not know whether the work will be done early or late in 1996; nevertheless, progress has been made, and I will not challenge the Minister further.

The simple fact is that Ministers will not say how much money they have. They must say where the money is coming from. From what we have heard, it seems that not one penny—[Interruption.] If the hon. Member for Hayes and Harlington (Mr. Dicks) would sit quietly for a while, he would probably add to his knowledge.

Not one penny is coming from the private sector. Track access charges will support part of the project. The Government are trying to get £200 million from Europe; the trans-European networks money does not stretch to that. We shall wait with interest following the Minister's commitment to a 1996 start to the project.

The Secretary of State should be embarrassed about two other issues—or, rather, not necessarily the current Secretary of State, but his predecessor. Although 250 applications were received for a job on the Rail Users Consultative Committee, the Minister for Railways and Roads apparently suggested that none of the applicants was suitable. The Government then went on a spree to find a "placeperson". Will the Minister tell us whether the search has been successful? Are we to have a "yes-person" in the post? Obviously, the Government will be happy to see the departure of the present incumbent, who is retiring; but I sincerely hope that this will not be a manipulated quango job. If it is, it is another subject that the Nolan committee should investigate at an early stage.

The Secretary of State will probably know that his predecessor started a project called "the informed traveller". The essential aim was to retain network benefits in the crazy system of the privatised rail network. Are the Government still committed to that project? If they are, when benefits are likely to accrue—at least in directions from the Secretary of State?

The Government's key defence, advanced from both the Front and the Back Benches, is, "Do not worry about this privatisation; it is just like what happened with British Airways." That myth should be buried once and for all. Let us imagine that British Airways had been privatised in the same way as British Rail. We have 25 train operating companies with British Rail, so we should have had 25 aeroplane operating companies. Let us take the Manchester to London route, and franchise it separately; let us do the same with the Glasgow to London route. The Ministers smile, but that gives the lie to claims that this privatisation is anything like that of British Airways.

We have ROSCOs—rolling stock leasing companies—in the rail network; would we have had PLESCOs, or plane leasing companies, in British Airways, under Lord King? Would 737s, 757s, 767s and 777s be owned by separate companies and leased out? Of course not.

British Airways has one of the best maintenance services in the country. Throughout the country, it employs key people to provide services. In the scenario that I have described, it would not own anything. It sub-contracts, but that is not the same as a system of individual owners.

The key issue, however, is this: if British Airways had been offered a £2 billion subsidy in perpetuity, that would be similar to what the railways are getting. How can a service be privatised when there is a £2 billion subsidy committing Governments in 2010, 2020 or 2030? That is ridiculous. As if the financial position were not bad enough, to add insult to taxpayers' injury, that £2 billion is to be topped up with an extra £600 million once the railways are in the private sector.

I am a Scot; I am canny with money; I am a moderate; and I have a lot of common sense. But I must tell people at the next election that the privatised railway will cost them £2.6 billion for ever. When is a privatisation not a privatisation? I suggest that this is one privatisation too many. It does not stand up to any critical analysis or objective criteria.

The Government know that the privatisation is not working. We hoped that the new Secretary of State would have had his honeymoon, bedded into the job and then realised that his predecessors had whipped up some support for a crazy idea. I sincerely hope that the right hon. Gentleman will now wish to back off from an idea that is causing immense damage to the fabric of industry and destroying morale. It is not likely to generate a penny of the extra private investment that we hear about, and, ultimately, will probably deprive the industry of any network benefits.

If the Government do not listen, they must suffer the consequences at the next election. I can tell Conservative Members with hard-pressed commuter seats where train dependency is high that we will campaign in those seats, and the smiles will be taken off their faces if the shambles that we envisage comes to pass. If they do not build the railways for the future, Labour will put them back together when we take power—as quickly as possible.

6.48 pm

If the debate has proved nothing else, it has at least proved that King Canute is alive and kicking in Oldham, West. The hon. Member for Oldham, West (Mr. Meacher) has convinced himself that if he repeats the claims that rail privatisation will not happen, his empty words can stop it happening. He is oblivious to the water that is already lapping around his feet—presumably as a result of the leaks that he welcomes so openly. He cannot recognise the irresistible tide that is engulfing him.

Arguably, it is unfair to compare the hon. Gentleman to King Canute—unfair to King Canute, that is. As I recall, it was the foolish courtiers surrounding the king who believed that his words had magical powers. The king commanded the waves to show them their folly. But in the context of rail privatisation, we are dealing with a foolish would-be king. His policy can be described in the words of his hon. Friend the Member for Nottingham, East (Mr. Heppell) as a "cobweb of confusion".

My right hon. Friend the Secretary of State and the hon. Member for North Cornwall (Mr. Tyler) have both tried unsuccessfully to prise out of the hon. Members for Oldham, West and for Fife, Central (Mr. McLeish) precisely what the policy enunciated at their conference really means. Why have both of them refused to clarify the old Labour commitment to nationalisation which new Labour has made? That commitment is to renationalise the railways. Have they realised, for instance, that a commitment to renationalise makes their claim that they can stop the privatisation happening look rather more ludicrous than it does in any event? Or has the shadow Chancellor calculated that the cost of implementing the policy cannot be funded out of "endogenous growth"? Or have they recognised that there is at least a slight inconsistency between this new policy and Labour's much vaunted abandonment of clause IV about a year ago?

The hon. Member for Oldham, West sought to cross swords with my right hon. Friend the Secretary of State over the comparison that my right hon. Friend drew between British Airways and British Rail. Not knowing when he was beaten, the hon. Member for Fife, Central returned later to the attack. Both of them are misleading themselves.

A proper comparison between British Rail and the British airline industry would not look at British Airways on its own and ask how it would be if it had been broken up into 90 separate parts. The starting point with rail is an industry which has, in all its aspects, been owned by the public sector since the folly of nationalisation by the post-war Labour Government. The comparison would have to be with one publicly owned corporation owning British Airways, Virgin, British Midland, Air UK and all the other operators, plus all the airports and probably control of air traffic control services as well. That would be a true comparison.

The hon. Member for Fife, Central seems to have been labouring under the misapprehension that British Airways owns all its aircraft. If he checks, he will find that a large part of British Airways' fleet is leased, just as happens throughout the industry internationally. It is a fact, as my right hon. Friend tried to explain to Opposition Front Benchers, that with the airlines—here I draw comparisons, as I have before, with road passenger transport and road haulage—the ownership of the infrastructure over which services are run is not the same as ownership of those who operate services on the structure or who provide for maintaining it.

Why, then, was British Airways not broken up into 25 internal United Kingdom sections? [HON. MEMBERS: "You have just heard why."] I am not talking about the British airline industry. There is a big difference between the Minister's point and what some Conservative Back Benchers were saying earlier.

No, there is no difference. With the airline industry we did not start from as bad a position as with the railways, where every aspect of service operation and infrastructure was contained in one monolithic structure. In the airline industry there was already separate ownership of the infrastructure and of operations. I therefore invite the hon. Gentleman to reflect on the seminar that I have just given him.

The hon. Member for Oldham, West also revealed once again his complete misunderstanding of the funding of the railways, pre-privatisation and post-privatisation. If he and his hon. Friend will look at the figures, they will see that, in the period before we started on the restructuring and privatisation of rail, Government support for the industry was broadly £1.5 billion a year; and they will see, in the same Transport Select Committee report from which they plucked out the £700 million additional cost figure, that Committee's judgment that in 1997, when privatisation will be complete, the amount of taxpayers' support needed will be broadly £1.5 billion a year.

They are confused about the intervening years because, this year and next, the figures that appear in the public expenditure statements include a line that deals with privatisation effects: a broad estimate and a composite estimate of the receipts from the sales of the businesses which, as my right hon. Friend the Secretary of State has explained, are now gathering pace.

The hon. Member for Oldham, West also confused himself about the value of assets at replacement prices in Railtrack and the stock market valuation of the company. Of course there will be no relationship between the stock market valuation of the company when it is floated next spring and the way in which track access charges are calculated and approved by the rail regulator.

What evidence does the Minister have for saying that sales are gathering pace?

My right hon. Friend said earlier that businesses with a turnover of about £4 billion are now on the market, some of them sold—[Interruption.] The hon. Member for Oldham, West has an inaccurate list of what has been sold. He mentioned heavy maintenance depots, but omitted the recent sale of On Board Services.

The hon. Gentleman sneers, but the business ranks third in this country's catering industry in terms of the number of pre-prepared meals that it serves every day—so it is not chickenfeed—[Laughter.] In fact, it is good Minister feed, as the photographs in the Evening Standard of that day showed. However, I understand why the hon. Gentleman wants to deflect attention from his misunderstanding of track access charges.

The relevance of replacement values to calculating track access charges is that the regulator has set charges at a level that will ensure that Railtrack has the funds of about £600 million a year which it needs to spend to maintain and improve the system. But the stock market valuation has no relevance whatever to the level of track access charges. Because of the increased efficiency that will come from the private sector operation of Railtrack, track access charges are falling, by 8 per cent. in real terms immediately, and thereafter by 2 per cent. below the retail prices index for the next five years.

My hon. Friend the Member for Blackpool, South (Mr. Hawkins) reminded the House that the passenger service requirement introduces a guarantee of service levels for the first time ever. The publicly owned and accountable railway to which Opposition Front Benchers are so attracted has never given such guarantees. In fact, the publicly owned and accountable railway has the power, which it sometimes exercises, to reduce services to the point at which any further cut in services would mean that they disappeared altogether. So that is the sort of guarantee that passengers have with the structure that Opposition Members find so attractive.

I must tell the hon. Member for North Cornwall, moreover, that, in the publicly owned and accountable railway, management have the power to increase fares by as much as 56 per cent. What is the benefit of public ownership and accountability when that is what passengers may have to face? By contrast, the fares regime announced by the franchising director provides greater protection for passengers than they have ever enjoyed in the past.

My hon. Friend the Member for Worcester (Mr. Luff) referred correctly to the stultifying effect of nationalisation. Privatisation of the railways will be the trigger for the renaissance of the railway industry, to which Opposition Members pay lip service but which they are not prepared to deliver. My hon. Friend rightly castigated the hon. Member for Oldham, West and others for their irresponsible and mischievous scaremongering over safety. The reality is that the safety regime that is introduced with the restructuring and privatisation of the railways is much more rigorous than the blanket safety authorisation covering the whole of British Rail, under which the nationalised railway has operated.

Under the new regime, every individual company and unit operating within the railway industry must satisfy, first, Railtrack and, ultimately, the Health and Safety Executive that it is competent to manage safety on the railway. That is a much higher requirement than has ever existed before, and it is also an open regime which involves people broadly across the railway industry, including the trade unions, which, of course, have valuable expertise and views to express on safety measures. It is part of that open regime that information about the causes of accidents and the way in which they might be avoided in the future must be disseminated widely if we are to ensure the highest possible standards.

I am conscious of the time, as no doubt you are, Madam Speaker; therefore I do not have time, sadly, to respond to all the other interesting and valuable points made by my right hon. and hon. Friends or to continue rebutting all the fallacies on which the arguments of Opposition Members were based. It must be clear, even to King Canute sitting opposite, that there is now an irresistible momentum to privatisation. If the hon. Member for Oldham, West does not recognise that, he will be swept away as the tide continues to come in.

Question put, That the original words stand part of the Question:—

The House divided: Ayes 259, Noes 288.

Division No. 217]

[7.01 pm

AYES

Abbott, Ms DianeBruce, Malcolm (Gordon)
Adams, Mrs IreneByers, Stephen
Ainger, NickCaborn, Richard
Ainsworth, Robert (Cov'try NE)Callaghan, Jim
Allen, GrahamCampbell, Mrs Anne (C'bridge)
Alton, DavidCampbell, Menzies (Fife NE)
Anderson, Donald (Swansea E)Campbell, Ronnie (Blyth V)
Anderson, Ms Janet (Ros'dale)Campbell-Savours, D N
Armstrong, HilaryCann, Jamie
Ashdown, Rt Hon PaddyCarlile, Alexander (Montgomery)
Ashton, JoeChisholm, Malcolm
Austin-Walker, JohnChurch, Judith
Banks, Tony (Newham NW)Clapham, Michael
Barnes, HarryClark, Dr David (South Shields)
Barron, KevinClarke, Eric (Midlothian)
Battle, JohnClarke, Tom (Monklands W)
Bayley, HughClelland, David
Beckett, Rt Hon MargaretClwyd, Mrs Ann
Beith, Rt Hon A JCoffey, Ann
Bell, StuartCohen, Harry
Benn, Rt Hon TonyCook, Robin (Livingston)
Bennett, Andrew FCorbett, Robin
Bernningham, GeraldCorbyn, Jeremy
Berry, RogerCorston, Jean
Betts, CliveCousins, Jim
Blair, Rt Hon TonyCox, Tom
Boateng, PaulCunliffe, Lawrence
Bradley, KeithCunningham, Jim (Covy SE)
Bray, Dr JeremyCunningham, Rt Hon Dr John
Brown, Gordon (Dunfermline E)Dafis, Cynog
Brown, N (N'c'tle upon Tyne E)Dalyell, Tam

Darling, AlistairKennedy, Jane (L'pool Br'dg'n)
Davies, Bryan (Oldham C'tral)Khabra, Piara S
Davies, Chris (L'Boro & S'worth)Kilfoyle, Peter
Davies, Rt Hon Denzil (Llanelli)Kirkwood, Archy
Davies, Ron (Caerphilly)Lestor, Joan (Eccles)
Denham, JohnLewis, Terry
Dewar, DonaldLiddell, Mrs Helen
Dixon, DonLitherland, Robert
Dobson, FrankLivingstone, Ken
Donohoe, Brian HLloyd, Tony (Stretford)
Dowd, JimLlwyd, Elfyn
Dunwoody, Mrs GwynethLoyden, Eddie
Eagle, Ms AngelaLynne, Ms Liz
Eastham, KenMcAllion, John
Etherington, BillMcAvoy, Thomas
Evans, John (St Helens N)McCartney, Ian
Ewing, Mrs MargaretMcCartney, Robert
Fatchett, DerekMcFall, John
Field, Frank (Birkenhead)McKelvey, William
Fisher, MarkMackinlay, Andrew
Flynn, PaulMcLeish, Henry
Foster, Rt Hon DerekMcMaster, Gordon
Foster, Don (Bath)McNamara, Kevin
Foulkes, GeorgeMacShane, Denis
Fraser, JohnMadden, Max
Fyfe, MariaMaddock, Diana
Galloway, GeorgeMahon, Alice
Garrett, JohnMandelson, Peter
Gerrard, NeilMarek, Dr John
Gilbert, Rt Hon Dr JohnMarshall, David (Shettleston)
Godman, Dr Norman AMartin, Michael J (Springburn)
Godsiff, RogerMartlew, Eric
Golding, Mrs LlinMaxton, John
Graham, ThomasMeacher, Michael
Griffiths, Nigel (Edinburgh S)Michael, Alun
Griffiths, Win (Bridgend)Michie, Bill (Sheffield Heeley)
Grocott, BruceMichie, Mrs Ray (Argyll & Bute)
Gunnell, JohnMilburn, Alan
Hain, PeterMiller, Andrew
Hall, MikeMitchell, Austin (Gt Grimsby)
Hanson, DavidMoonie, Dr Lewis
Harman, Ms HarrietMorgan, Rhodri
Harvey, NickMorris, Rt Hon Alfred (Wy'nshawe)
Hattersley, Rt Hon RoyMorris, Estelle (B'ham Yardley)
Henderson, DougMorris, Rt Hon John (Aberavon)
Heppell, JohnMowlam, Marjorie
Hill, Keith (Streatham)Mudie, George
Hinchliffe, DavidMullin, Chris
Hodge, MargaretMurphy, Paul
Hoey, KateOakes, Rt Hon Gordon
Hogg, Norman (Cumbernauld)O'Brien, Mike (N W'kshire)
Home Robertson, JohnO'Brien, William (Normanton)
Hood, JimmyOlner, Bill
Hoon, GeoffreyO'Neill, Martin
Howarth, Alan (Strat'rd-on-A)Orme, Rt Hon Stanley
Howells, Dr. Kim (Pontypridd)Parry, Robert
Hoyle, DougPearson, Ian
Hughes, Kevin (Doncaster N)Pendry, Tom
Hughes, Roy (Newport E)Pickthall, Colin
Hughes, Simon (Southwark)Powell, Ray (Ogmore)
Hutton, JohnPrentice, Bridget (Lew'm E)
Illsley, EricPrentice, Gordon (Pendle)
Ingram, AdamPrescott, Rt Hon John
Jackson, Glenda (H'stead)Primarolo, Dawn
Jackson, Helen (Shef'ld, H)Purchase, Ken
Janner, GrevilleQuin, Ms Joyce
Johnston, Sir RussellRadice, Giles
Jones, Barry (Alyn and D'side)Randall, Stuart
Jones, Ieuan Wyn (Ynys Môn)Raynsford, Nick
Jones, Lynne (B'ham S O)Redmond, Martin
Jones, Martyn (Clwyd, SW)Reid, Dr John
Jones, Nigel (Cheltenham)Rendel, David
Jowell, TessaRobertson, George (Hamilton)
Kaufman, Rt Hon GeraldRoche, Mrs Barbara
Keen, AlanRogers, Allan
Kennedy, Charles (Ross, C&S)Rooker, Jeff

Rooney, TerryTaylor, Matthew (Truro)
Ross, Ernie (Dundee W)Timms, Stephen
Ruddock, JoanTipping, Paddy
Sedgemore, BrianTouhig, Don
Sheerman, BarryTurner, Dennis
Sheldon, Rt Hon RobertTyler, Paul
Short, ClareVaz, Keith
Simpson, AlanWalker, Rt Hon Sir Harold
Skinner, DennisWallace, James
Smith, Andrew (Oxford E)Walley, Joan
Smith, Chris (Isl'ton S & F'sbury)Welsh, Andrew
Smith, Llew (Blaenau Gwent)Wicks, Malcolm
Snape, PeterWilliams, Rt Hon Alan (Sw'n W)
Williams, Alan W (Carmarthen)
Soley, CliveWilson, Brian
Spearing, NigelWinnick, David
Spellar, JohnWise, Audrey
Squire, Rachel (Dunfermline W)Worthington, Tony
Steel, Rt Hon Sir DavidWray, Jimmy
Stevenson, GeorgeWright, Dr Tony
Stott, RogerYoung, David (Bolton SE)
Strang, Dr. Gavin
Straw, Jack

Tellers for the Ayes:

Sutcliffe, Gerry

Mr. Joe Benton and Mr. John Cummings.

Taylor, Mrs Ann (Dewsbury)

NOES

Ainsworth, Peter (East Surrey)Channon, Rt Hon Paul
Aitken, Rt Hon JonathanChapman, Sydney
Alexander, RichardChurchill, Mr
Alison, Rt Hon Michael (Selby)Clappison, James
Allason, Rupert (Torbay)Clark, Dr Michael (Rochford)
Amess, DavidClarke, Rt Hon Kenneth (Ru'clif)
Ancram, MichaelClifton-Brown, Geoffrey
Arbuthnot, JamesCoe, Sebastian
Arnold, Jacques (Gravesham)Congdon, David
Arnold, Sir Thomas (Hazel Grv)Conway, Derek
Ashby, DavidCoombs, Anthony (Wyre For'st)
Atkins, Rt Hon RobertCoombs, Simon (Swindon)
Atkinson, David (Bour'mouth E)Couchman, James
Atkinson, Peter (Hexham)Cran, James
Baker, Nicholas (North Dorset)Currie, Mrs Edwina (S D'by'ire)
Banks, Matthew (Southport)Curry, David (Skipton & Ripon)
Banks, Robert (Harrogate)Davies, Quentin (Stamford)
Bates, MichaelDavis, David (Boothferry)
Batiste, SpencerDay, Stephen
Bellingham, HenryDevlin, Tim
Bendall, VivianDicks, Terry
Beresford, Sir PaulDorrell, Rt Hon Stephen
Biffen, Rt Hon JohnDouglas-Hamilton, Lord James
Bonsor, Sir NicholasDover, Den
Booth, HartleyDuncan, Alan
Boswell, TimDuncan-Smith, Iain
Bottomley, Peter (Eltham)Dunn, Bob
Bottomley, Rt Hon VirginiaDurant, Sir Anthony
Bowden, Sir AndrewEggar, Rt Hon Tim
Bowis, JohnElletson, Harold
Boyson, Rt Hon Sir RhodesEvans, David (Welwyn Hatfield)
Brandreth, GylesEvans, Jonathan (Brecon)
Brazier, JulianEvans, Nigel (Ribble Valley)
Bright, Sir GrahamEvans, Roger (Monmouth)
Brooke, Rt Hon PeterEvennett, David
Brown, M (Brigg & Cl'thorpes)Faber, David
Browning, Mrs AngelaFabricant, Michael
Bruce, Ian (Dorset)Fenner, Dame Peggy
Budgen, NicholasReld, Barry (Isle of Wight)
Burns, SimonFishburn, Dudley
Burt, AlistairForman, Nigel
Butcher, JohnForsyth, Rt Hon Michael (Stirling)
Butler, PeterForth, Eric
Butterfill, JohnFowler, Rt Hon Sir Norman
Carlisle, Sir Kenneth (Lincoln)Fox, Dr Liam (Woodspring)
Carrington, MatthewFox, Sir Marcus (Shipley)
Carttiss, MichaelFreeman, Rt Hon Roger
Cash, WilliamFrench, Douglas

Fry, Sir PeterLawrence, Sir Ivan
Gale, RogerLegg, Barry
Gallie, PhilLeigh, Edward
Gardiner, Sir GeorgeLennox-Boyd, Sir Mark
Garnier, EdwardLidington, David
Gill, ChristopherLightbown, David
Gillan, CherylLilley, Rt Hon Peter
Goodlad, Rt Hon AlastairLloyd, Rt Hon Sir Peter (Fareham)
Goodson-Wickes, Dr CharlesLord, Michael
Gorman, Mrs TeresaLuff, Peter
Gorst, Sir JohnLyell, Rt Hon Sir Nicholas
Grant, Sir A (SW Cambs)MacGregor, Rt Hon John
Greenway, Harry (Ealing N)MacKay, Andrew
Griffiths, Peter (Portsmouth, N)Maclean, Rt Hon David
Gummer, Rt Hon John SelwynMcLoughlin, Patrick
Hague, WilliamMcNair-Wilson, Sir Patrick
Hamilton, Rt Hon Sir ArchibaldMadel, Sir David
Hamilton, Neil (Tatton)Major, Rt Hon John
Hampson, Dr KeithMalone, Gerald
Hanley, Rt Hon JeremyMans, Keith
Hannam, Sir JohnMarland, Paul
Hargreaves, AndrewMarshall, John (Hendon S)
Haselhurst, Sir AlanMarshall, Sir Michael (Arundel)
Hawkins, NickMartin, David (Portsmouth S)
Hawksley, WarrenMates, Michael
Hayes, JerryMawhinney, Rt Hon Dr Brian
Heald, OliverMellor, Rt Hon David
Heath, Rt Hon Sir EdwardMerchant, Piers
Heathcoat-Amory, DavidMills, Iain
Hendry, CharlesMitchell, Andrew (Gedling)
Heseltine, Rt Hon MichaelMitchell, Sir David (NW Hants)
Higgins, Rt Hon Sir TerenceMoate, Sir Roger
Hill, James (Southampton Test)Monro, Sir Hector
Hogg, Rt Hon Douglas (G'tham)Montgomery, Sir Fergus
Horam, JohnNeedham, Rt Hon Richard
Hordern, Rt Hon Sir PeterNeubert, Sir Michael
Howard, Rt Hon MichaelNewton, Rt Hon Tony
Howell, Sir Ralph (N Norfolk)Nicholls, Patrick
Hughes, Robert G (Harrow W)Nicholson, David (Taunton)
Hunt, Rt Hon David (Wirral W)Norris, Steve
Hunt, Sir John (Ravensbourne)Onslow, Rt Hon Sir Cranley
Hunter, AndrewOppenheim, Phillip
Hurd, Rt Hon DouglasOttaway, Richard
Jack, MichaelPage, Richard
Jackson, Robert (Wantage)Paice, James
Jenkin, BernardPatnick, Sir Irvine
Jessel, TobyPatten, Rt Hon John
Johnson Smith, Sir GeoffreyPattie, Rt Hon Sir Geoffrey
Jones, Gwilym (Cardiff N)Pawsey, James
Jones, Robert B (W Hertfdshr)Peacock, Mrs Elizabeth
Kellett-Bowman, Dame ElainePickles, Eric
King, Rt Hon TomPorter, Barry (Wirral S)
Kirkhope, TimothyPortillo, Rt Hon Michael
Knight, Mrs Angela (Erewash)Powell, William (Corby)
Knight, Rt Hon Greg (Derby N)Rathbone, Tim
Knight, Dame Jill (Bir'm E'st'n)Redwood, Rt Hon John
Knox, Sir DavidRenton, Rt Hon Tim
Kynoch, George (Kincardine)Richards, Rod
Lait, Mrs JacquiRifkind, Rt Hon Malcolm
Lang, Rt Hon IanRobathan, Andrew

Roberts, Rt Hon Sir WynThomason, Roy
Robertson, Raymond (Ab'd'n S)Thompson, Sir Donald (C'er V)
Robinson, Mark (Somerton)Thompson, Patrick (Norwich N)
Rowe, Andrew (Mid Kent)Thurnham, Peter
Rumbold, Rt Hon Dame AngelaTownend, John (Bridlington)
Ryder, Rt Hon RichardTownsend, Cyril D (Baxl'yh'th)
Sackville, TomTracey, Richard
Sainsbury, Rt Hon Sir TimothyTredinnick, David
Scott, Rt Hon Sir NicholasTrend, Michael
Shaw, David (Dover)Trotter, Neville
Shaw, Sir Giles (Pudsey)Twinn, Dr Ian
Shephard, Rt Hon GillianVaughan, Sir Gerard
Shepherd, Colin (Hereford)Viggers, Peter
Shepherd, Richard (Aldridge)Waldegrave, Rt Hon William
Shersby, Sir MichaelWalden, George
Sims, RogerWalker, Bill (N Tayside)
Skeet, Sir TrevorWaller, Gary
Smith, Tim (Beaconsfield)Ward, John
Soames, NicholasWardle, Charles (Bexhill)
Spicer, Sir James (W Dorset)Waterson, Nigel
Spicer, Michael (S Worcs)Watts, John
Spink, Dr RobertWells, Bowen
Spring, RichardWhitney, Ray
Sproat, IainWhittingdale, John
Squire, Robin (Hornchurch)Widdecombe, Ann
Steen, AnthonyWiggin, Sir Jerry
Stephen, MichaelWilkinson, John
Stern, MichaelWilshire, David
Stewart, AllanWinterton, Mrs Ann (Congleton)
Streeter, GaryWinterton, Nicholas (Macc'f'ld)
Sumberg, DavidWolfson, Mark
Sweeney, WalterWood, Timothy
Sykes, JohnYeo, Tim
Tapsell, Sir PeterYoung, Rt Hon Sir George
Taylor, Ian (Esher)
Taylor, John M (Solihull)

Tellers for the Noes:

Taylor, Sir Teddy (Southend, E)

Mr. David Willetts and Mr. Roger Knapman.

Temple-Morris, Peter

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 30 (Questions on amendments), and agreed to.

MADAM SPEAKER forthwith declared the main Question, as amended, to be agreed to.

Resolved,

That this House believes that privatisation of the railways will bring better services to passengers, as has happened with previous privatisations, such as British Airways and British Airports Authority; contrasts this with the Opposition's commitment to renationalise the railways; welcomes the announcement that Railtrack will be floated next Spring, allowing access to private capital and opportunities for investors; and further welcomes the progress that has already been made on privatisation, which will lead to a new era for passengers, with fares and services protected for the first time.

National Blood Service

I have selected the amendment standing in the name of the Prime Minister.

7.16 pm

I beg to move,

That this House pays tribute to the nation's two million blood donors, on whose goodwill and generosity the National Blood Service and National Health Service depend; congratulates blood service staff in the regional blood transfusion centres for maintaining a high quality service despite the continuing uncertainty surrounding the service; deplores the proposal to close testing and/or processing facilities at Liverpool, Lancaster, Oxford, Brentwood and Plymouth blood centres in the absence of any conclusive evidence that closure will lead to improvements in the quality of service to people living in those areas; condemns the National Blood Authority for pre-empting the Secretary of State's decision on the future of the National Blood Service by pushing ahead with its proposed re-organisation before any final announcement; and calls on the Secretary of State to visit each threatened centre to hear at first hand the concerns of donors and staff and take account of their representations before finalising his decision about the future organisation of the blood service.
It is appropriate to begin on the point that is not held in contention between ourselves and the Government. I pay tribute to the 2 million people, our fellow citizens, who every year give blood voluntarily and generously, often at their own expense and inconvenience. They do so because they care about the health of other people—[Interruption.]

Order. I cannot hear a word that the hon. Member for Newcastle upon Tyne, East (Mr. Brown) is saying.

Thank you, Madam Speaker. I was surprised to see the Secretary of State for Health heckling me from behind your Chair. I note that he has left the business end of the debate in the hands of his very capable deputy, the Minister for Health. It is appropriate—

It is always such a pleasure to be urged on by the hon. Lady, who seems to have a special and, dare I say it, unique affection for listening to me speak from the Dispatch Box. I welcome her to this debate.

The blood service is a central part of the national health service. It is a symbol of the enduring philosophical truth that lies behind a health service which is comprehensive, unified, publicly owned, publicly accountable and free at the point of need—the principle that we can achieve more by acting together than if we act alone.

There are currently 15 English regional blood transfusion centres. Each centre carries out blood collection, testing, processing, delivery and specialist services such as research and development. In 1993, the National Blood Authority was set up to oversee the administration of the blood service. It was instructed to carry out a review of the service to maximise efficiency and to minimise waste and inefficiency. There is nothing wrong with that intention. The annual budget of the blood service is about £130 million and it is important that public money is wisely spent.

As part of the review, the National Blood Authority commissioned several private firms of management consultants to offer advice on possible reorganisation—advice which has cost the taxpayer £1.25 million. It is interesting to note that management consultants employed by Government Departments in the past three years have cost on average £500 million per year. It is even more revealing to note that, according to a report from the Cabinet office efficiency unit in August 1994, the savings achieved by those management consultants amount to an average of £12.2 million per year. A total of £500 million pounds spent on achieving savings of £12.2 million is not a ringing endorsement of those management consultants, nor of the Ministers responsible for hiring them.

However, let us be generous and give the consultants the benefit of the doubt, at least for the purposes of the debate. Perhaps the advice offered to the National Blood Authority was of a higher quality than the other advice that management consultants offer to Departments and quangos. Let us look at the advice that the consultants, Bain and Co., provided in exchange for more than £1 million of public money.

Bain and Co. suggested a streamlining of donor sessions, proposing that it should take 9.5 minutes to take a unit of blood. Clearly the consultants were unaware that the current regulations require almost double that time—17.5 minutes—to be taken. They also proposed to end smaller "inefficient" sessions yielding fewer than 90 donations per day, despite the fact that such sessions account for 30 per cent. of all donations.

Next, the consultants proposed using fewer units of blood for operations. That is the sort of recommendation that one would expect from management consultants. According to Bain and Co., such a measure would reduce demand for blood by 23 per cent. The idea is that if we give people less blood the demand will fall. But it seems rather a dangerous proposition. Last Friday the British Medical Journal contained advice contradicting that of the consultants. Leading haematologists suggested that even current practices leave critically ill patients short of blood. So there is hardly a case for reducing the amount of blood given.

Bain and Co. also suggested that money could be saved by leaving blood at room temperature for 24 hours before refrigeration. I am sure that it could, but there is a danger that blood products could be infected by bacteria and become unsuitable for use.

The consultants also proposed—this is the heart of the issue that we are debating—that five of the 15 regional transfusion centres should be closed and the blood service restructured into three administrative zones. That is the proposal which has proved so universally unpopular with clinicians, staff and donors. It means that the public will be required to travel further to larger, more impersonal donation sessions, with a consequent fall in donations.

It is rather a shame that the debate has kicked off to a false start, with the hon. Gentleman suggesting that the centres are to close. It has been suggested that certain processing functions will be moved away from them, but donors will not have to travel further. The centres will still be available for the donation of blood, so what the hon. Gentleman has said is simply not true.

The proposals are based on what is called option D of the Bain report, which recommends full closure of five or six centres. Gary Austin, the designated chief executive of the midlands and south-western zone, has written to representatives of the Oxford blood centre about the "closure" of that centre. That is his word, and if the Minister wishes to dispute it his quarrel is with Gary Austin, not with me.

Given the scale of public and donor opposition to the closure proposals—Oxfordshire has produced the county's biggest ever petition—and given the scale of clinical and consultant concern, with more than 100 clinicians, including world-leading heart surgeons, having signed a statement opposing closure and expressing concern about the effects of the withdrawal of the testing and processing functions, is it not time that the National Blood Authority and the Government took notice and acted to keep the centres, including their testing and processing functions, open?

My hon. Friend is right. A hundred clinicians say the same as I have said. The Minister alone denies it.

People outside following the debate will make up their own minds whose word is to be relied upon, and I shall have something to say later about the reliability of Ministers.

Does my hon. Friend agree that part of the confusion about language arises from the National Blood Authority itself? Initially, in its shoddy consultation document, it announced closure. Then it started to back-track. Those of us who have tried to pin the authority down to some reasonable proposals are amazed at the way in which it keeps shifting the meaning of language and deliberately confusing the debate, while at the same time implementing the proposals which are so strongly opposed throughout the country.

I shall say something later about the way in which the proposals are being implemented, but my hon. Friend is absolutely right. She speaks for the country, while the Minister will have difficulty being treated with respect by those who are following the debate. I shall have something to say about statements by Ministers, too.

Will the hon. Gentleman explain why the Labour party wants to take the advice of clinicians only on some occasions? For instance, it entirely ignores the advice of GP fundholders on its policy. Why is it not more consistent?

I am being lured slightly away from the main thrust of the debate, but I must tell the hon. Gentleman that in Fundholding magazine, a periodical specifically for GP fundholders, 75 per cent. of the fundholders polled said that they opposed fundholding. So we are listening to the majority of clinicians. We are more than happy to take advice, as the hon. Gentleman urges. Having satisfied him completely, I shall continue with my speech.

The second implication of the proposals for the blood service is that specialist centres of excellence will be lost. Thirdly, some specialist services, such as transplant technology and cancer treatment research, will be threatened. Above all, we believe that the review has underestimated the future growth in demand for blood and overestimated the excess capacity in the service.

There is a real risk that future supplies of blood to national health service hospitals may be inadequate. What the review calls an excess the service calls a safety margin, to deal with events such as war, or the purchase of Tuta bags. [Interruption.] The Minister seems surprised that I refer to wars, but he should think back to the Falklands conflict and the Gulf war. We were all grateful that masses of blood products were not needed, but they might have been.

That was not the reason for my incredulity. The suggestion that the problem experienced with Tuta bags can be compared with war is absurd. The hon. Gentleman does himself no credit by making such a comparison.

The Minister has missed the point. Both examples represent events which put pressure on the supply of blood products. It is perfectly obvious to most people following the debate that both events, although quite different in their nature, would put pressure on short-term supplies of blood products. That is why it is necessary to have a surplus. It is far better to have a surplus than a deficit.

The proposals are paralleled by other initiatives which have met with considerable opposition. The first, of course, is the sale of blood products—and the confidence of the House in the Conservative party's reform agenda for the blood service is unlikely to have been shored up by the answers that have been given to the House. On 12 December 1994, in a written answer to my hon. Friend the Member for Barnsley, Central (Mr. Illsley), the Parliamentary Under-Secretary of State for Health said:
"Blood collected by the national blood service is for the needs of the national health service not for sale or export."—[Official Report, 12 December 1994; Vol. 251, c. 473.]
Given that assurance, many of us were concerned to learn that the National Blood Authority does sell blood to the private sector and does sell blood products overseas. These transactions were said to be worth about £5 million a year. More concern was caused by newspaper reports suggesting that the NBA was considering increasing the volume of sales abroad to around £14 million per annum. That may well be standard practice for a private profit-driven firm in a competitive market, but it surely has no place in an ethically based public service, the overriding purpose of which is to meet the needs of patients. The proposal also does not go down well with donors.

The blood products sold—in particular, factor VIII—are surplus to requirements in Britain, they are provided at cost and they are provided to help people who are ill. What is wrong with helping people in that way? Surely the hon. Gentleman does not want to stop helping people who need factor VIII just because they are not English. Is that not taking xenophobia a stage too far?

I am slightly surprised to be accused of xenophobia by the hon. Member for Brentwood and Ongar (Mr. Pickles) and his party. I followed with some interest the speech of the Secretary of State for Defence at the Conservative party conference. Perhaps the hon. Gentleman would like to have a word with his right hon. Friend before he starts throwing around charges of xenophobia.

The point I am making is that our fellow citizens give blood freely and altruistically as a public service. They do not give blood to have it treated as a tradeable commodity. The hon. Gentleman implied that all the blood products that are sold are surplus, whereas in fact that is not the case. Blood products are now being treated as a tradeable commodity to generate income for the authority. It is not a question of selling off the surplus.

I entirely agree with the hon. Member for Newcastle upon Tyne, East (Mr. Brown). People who give blood do so altruistically and generously and because they want to give their blood for humanitarian reasons. What they find offensive is that they are not even told when their blood is sold on to second and third agencies who may well make money out of the transactions.

I agree completely with the hon. Gentleman, and I believe that the further the National Blood Authority goes down that route, the more it will put in jeopardy the altruism of those providing blood.

In a survey conducted by the NBA, donors were asked whether they
"support the sale of surplus plasma derivatives for countries in the European Community provided the monies raised offset running costs to the National Blood Service".
I submit that it would be difficult to write the question in such a way as to make it more likely that the answer received would be yes. Nevertheless, more than 8 per cent. of donors who responded were opposed to the idea of selling surplus blood products in the very narrow circumstances outlined in the question.

No doubt the Minister will now say that that is a wholesale endorsement of the selling of blood products.

No, but I hope that the hon. Gentleman will be honest with the House. He should make the point that if the surplus blood products were not sold and the cash brought back into the NHS, the products would be destroyed. Does he think that donors would prefer to see part of what they have given destroyed rather than given to patients, wherever else they may be? That is an extraordinary suggestion.

First, the products are not given—they are sold. Secondly, they do not go to patients wherever they may be but are sold at market rates in places such as Turkey.

Is the hon. Gentleman aware of the price lists in Turkish publications which appear to show that middlemen are making massive profits out of the sale of blood products bought from the National Blood Authority?

I was aware of the general market in Turkey, although I was not aware of the price lists or the profit margins of middlemen. No doubt the Minister knows more about the matter than I do.

The point I wanted to make was that if 8 per cent. of donors decided to withhold their gift—and it is a gift—of blood, the effect on national blood stocks would be disastrous. The Government are doing a very dangerous thing in undermining the ethical base of the service.

In addition to the sale of blood and blood products, there is evidence of creeping commercialisation of the service. The removal of the crown emblem from the national blood service logo has met with opposition from donors and blood service staff, and a petition was presented against the plan to the Prime Minister this morning. Why should the crown emblem—the symbol of our country—be removed from something that is supposed to be a public service? What emblem will replace it? Will it be something like the Conservative party torch or an advertisement for Ribena? Who knows?

It was recently revealed that the National Blood Authority is considering plans to allow Ribena and McVitie to provide sponsorship for the service, and it has been suggested that in exchange for that commercial sponsorship access to the database of 1.8 million blood donors could be facilitated so that the poor old blood donors can be targeted with junk mail.

In fairness, I received a letter from Smith Kline Beecham stating that there was never any question of that firm accessing the donor database. Nevertheless, meetings have taken place and surely no one can be in any doubt that commercial involvement puts further pressure on the principle that blood is given freely by altruistic citizens because they care about the health of others.

That brings me to my next point about dangerous cost-cutting. The procurement of Tuta blood bags with faulty and potentially dangerous seals was an ill-thought-out decision made by national blood service chiefs more concerned about cost than about quality. That kind of decision-making undermines people's trust and confidence in the service. Trust and confidence are commodities on which the service relies. They are principles without which the service could not function. The Government's encouragement of commercialisation and cost cutting poses a real threat to the central ethos of the service—that of altruism and public service.

The House should concern itself also with the effect of all this on the morale of staff. The proposals are unpopular, and the uncertainty and confusion which surrounds their implementation has had a damaging effect on staff morale. Resignations and early retirement are the most extreme expressions of disenchantment among staff. Among those who have left the service in recent months are Doctor Hugh Lloyd, from my city of Newcastle; Belinda Phipps, the director of the south London centre at Tooting; Douglas Jinks, chief executive of the Birmingham service; and Doctor Colin Entwistle, head of the Oxford service. The low levels of staff morale are threatening the viability of the service. This summer, Peter Bowells, a laboratory services manager in Oxford, told The Observer:
"If more staff were to leave prematurely, it would be very hard to maintain the service."
As well as staff morale, there are concerns about the levels of stock. The national blood service exists to ensure that NHS hospitals have access to all the blood supplies that are needed. Keeping adequate blood stocks is, therefore, a central imperative. But blood stock levels have fallen below the NBA's recommended absolute minimum levels on a number of occasions this year. In January, stock levels were below the recommended minimum level of 15,000 units on 10 out of 23 recorded days—in other words, 43 per cent. of the time. In June, the picture was equally worrying.

Before I bring my remarks to a conclusion, I want to refer to two constitutional issues which I think should worry the House and should be of concern to every hon Member, regardless of party political affiliation. The points that I want to raise relate directly to the rights of Parliament and the rights of hon. Members of the House of Commons. The NBA's proposed restructuring plans have led to commercialisation, corner-cutting and the alienation of staff and donors. It is my submission that it has also acted outside its authority and has pre-empted parliamentary approval.

Although the NBA proposals were put out for a three-month formal consultation in September 1994, no final decision from the NBA has been presented to Parliament for approval, despite repeated promises from Ministers. That might give us cause to think that the NBA was reconsidering its proposals in the light of the strong opposition from the national blood service staff and the general public, including the donors. Much as we might like to think the best of the NBA, however, the truth is rather far removed from that. The authority has already hired the senior officials—the top brass—for the new zonal administration. It has already filled between 20 and 25 newly created senior posts at a cost to the taxpayer of at least £1.5 million. Those people have been drawing salaries and driving around in company cars for the best part of this year but, it would appear—no doubt the Minister will be able to deal with this point—with no work to do.

The shadow Secretary for Health, my right hon. Friend the Member for Derby, South (Mrs. Beckett), has referred the matter to the Comptroller and Auditor General for investigation. As parliamentarians, it is clearly right that we should consider carefully the circumstances in which a quango proceeds to make such appointments without having the parliamentary authority that it requires. The matter has not yet been agreed and it should not have proceeded.

That brings me to the second matter, which also ought to concern parliamentarians on both sides of the House, regardless of party affiliation. As well as spending public money without Parliament's approval, the National Blood Authority has issued a gagging clause to its staff which in my view threatens the relationship between Members of Parliament and their constituents. The clause threatens disciplinary action against an employee of the authority for no greater offence than approaching a Member of Parliament. The authority's code states:
"Staff must exhaust the procedures laid down in this document",
which would take around 40 days by my reckoning,
"before contemplating consulting his or her Member of Parliament or disclosing information to the public or media. Failure to do so could undermine public confidence in the service"—
depending, of course, on what they intend to say to their Member of Parliament—
"and may result in disciplinary action being taken."
It is an affront to this House and to every Member of Parliament that a body which is supposedly under parliamentary control can insert in its code a restraint on the rights of citizens to approach their Members of Parliament. It is an affront to this House and it should not be allowed. It is a direct contravention of the constitutional right of every citizen to approach his or her Member of Parliament. Also, it flouts the guidance on staff relations with the public and the media laid down by the national health service management executive. No doubt the Minister will want to brush that matter to one side, but I do not see how he can easily do so.

We therefore ask hon. Members to join together to pay tribute to the nation's 2 million blood donors, on whose altruism and good will the national health service depends and to congratulate the staff of the regional transfusion centres for maintaining a high quality service despite continuing uncertainty about future reorganisations.

We must also deplore the proposals under consideration for the closure of facilities in five regional centres and must condemn the NBA for pre-empting parliamentary approval for its plans and attempting to gag its staff.

Finally, I call on the Secretary of State to consider carefully the proposals in the light of the overwhelming opposition to them and to reject them as ill conceived, damaging to the service and potentially threatening for the well-being of patients.

7.42 pm

I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:

'commends the continued support of blood donors, on which the Blood Service is founded and which is at the heart of the National Health Service; and fully recognises the commitment of blood service regional staff and the importance of ensuring that this vital national service continues to improve and develop into an integrated national service, based on high and uniform standards of safety, reliability and efficiency.'.
I start by assuring the hon. Member for Newcastle upon Tyne, East (Mr. Brown) that my right hon. Friend the Secretary of State is considering extremely carefully the proposals that have been put before him. The hon. Gentleman is probably aware of the fact that they were put before the then Secretary of State in early July. My right hon. Friend has been considering them with great care since. Indeed, a number of meetings with the hon. Gentleman's colleagues and others still have to take place before a final decision is taken on this important matter and I have no doubt that my right hon. Friend will read with great care the Hansard report of this debate.

Before we enter into detailed debate, let us be clear about the quality of the services that we are discussing. Our blood service is among the world's safest, through the reliability and quality of our donors and the thoroughness of our screening and testing systems. Another system not far from this country in Europe with 1.2 million donations per annum has a high prevalence of HIV—0.129 per thousand. In this country, the figure is much lower at 0.007 per thousand. I draw the attention of the House to that figure because it is a very important one and it underpins the quality of our service.

Last year in England, 2.4 million donations were given through the generosity of our unpaid voluntary donors for the direct benefit of about 800,000 desperately ill patients. The voluntary principle guarantees not only the basic supply, but its quality. In other countries where the voluntary principle does not pertain—in some where it appears to do so it does not in reality as payments are made by a number of means—the quality of blood donated is much worse than in the United Kingdom.

Contamination rates in some countries range from 2.5 times the United Kingdom level to a massive 280 times that level.

The Government clearly understand that the voluntary principle underpins the quality of supply. Our system works and I am pleased to be able to tell the House that it is the Government's firm undertaking and principle in this debate that that principle will remain.

I am grateful to the Minister for giving way, especially as he wishes to close the east London supply centre in Brentwood. He has paid tribute to blood donors and those of us who are past that age are happy to pay taxes for the process to continue. He has praised and emphasised the voluntary factor. Does he agree that that means that there should be no element of commercialism in anything that happens to the blood subsequently? If there is such commercialism, it is absolutely wrong. It is something that taxpayers and blood donors oppose and they will oppose any Government who change that principle.

Before the hon. Gentleman becomes hysterical about commercialism, let me set the matter in context. I was intending to do so later. Blood and the red cells derived from it are not for sale. They are provided at a price—a cost production price—to the national health service and the private sector in this country. With the increasing number of donations, there is an increasing quantity of blood products. The hon. Gentleman must ask himself what donors would say if products derived from blood donations were destroyed rather than sold in other marketplaces.

I will gladly give way when I have finished this point.

The cash received for those products is put back into the national health service to pay for increased patient care. That is something that, when properly explained rather than described in the rather absurd tones that the hon. Gentleman used, would be welcomed by the population of this country.

I was keeping my intervention short. I was excluding the question of the sale of products abroad. I am talking about the attitude of cutting costs and of making one area compete against another and reducing costs, possibly at the expense and risk of providing a lower-quality service. The hon. Gentleman cannot deny that that is happening. Surely that was the way in which the consultants mentioned by my hon. Friend the Member for Newcastle upon Tyne, East (Mr. Brown) went about their task.

I do not agree and, as I get on with my speech, the hon. Gentleman will understand that the proposals put forward for consultation, which are now with the Secretary of State, are designed to get rid of the inequalities in the service—any number of ranges of standards and costs—so that we can have a truly national service.

Does the Minister accept that the objection is not so much to the reinvestment of money within the national health and blood services, as to the fact that blood is being sold overseas at a list price of £90, but is then sold in countries such as Turkey at a list price of £399. Can he justify the profit made, given that he, his colleagues and the National Blood Authority have said that no profit is made out of blood? The profit is made by middlemen, who are creaming off substantial sums of money from donations given generously out of the good hearts of people in this country. Should not people in this country rightly object to that?

Those lists have been drawn to my attention. If the hon. Gentleman suggests that we should have custody from the Dispatch Box of arrangements as to when and in what circumstances blood products will move on from this country or from the national blood service, I must say that that is an extension of control beyond anything that even he should expect. The corollary of what he is saying is that it would be impossible to pass such products into any marketplace because it is not possible to control where they would go from there. Such controls simply do not exist.

The hon. Gentleman, from a sedentary position, asks why. It is impossible to have controls on passing such products into marketplaces because, as he would know if he were to look at the arrangements for competition policy, for example, in the European Union, it would not be allowed.

No, I cannot give way to the hon. Lady. I have given way significantly already and I must move on.

The NBA was set up in 1993 because of a range of concerns. Despite the high standards of care achieved by our service, there was clearly some room for improvement. The large number of regional blood centres had led to variable administrative practices, duplication of effort, wasteful use of resources and inadequate co-ordination. Let me give the House some examples to support that suggestion.

First, there are the donor selection criteria. There was a detailed national list of risk factors designed to ensure exclusion of donors at risk of infection. It was subject however to different interpretation of detail from region to region, which meant the unnecessary exclusion of some donors for reasons that did not add to blood safety but was due to an over-rigid interpretation.

The criteria for determining the suitability of locations for collection sessions varied from region to region. There were different methods of processing blood into its different parts, some of which could affect the efficacy of the product, though not its safety.

If I can get through this point, I will give way to the hon. Lady.

The reserve stockholding considered necessary for each centre varied between one day's supply and seven days' supply. Whatever can be said about that, one of those figures was clearly wrong and a view had to be taken about which was right.

There is also the question of use of stocks. Some regions aimed at self-sufficiency to the extent that they would ration their hospitals at times of temporary shortage rather than call on stocks that were available from other regions.

There is a wide variety of different arrangements for 24-hour on-call access to consultant specialist advice. That causes confusion to doctors who, in the course of their employment, move to other regions.

There was also the question of dissemination of information to donors. The forms, leaflets and other communications to donors varied in content, quality and frequency from region to region. There was clearly an agenda that had to be addressed and that is why the investigation was undertaken

I thank the Minister for giving way. He has made valid points but he has not made an argument as to why closing down five transfusion centres, including Liverpool, would deal with those points.

I shall deal not with closing down centres but with the restructuring that is proposed in the consultation document and the withdrawal of certain facilities from those centres. I was interested that the hon. Member for Newcastle upon Tyne, East (Mr. Brown) got it right in his concluding remarks when he stopped referring to closure, as he had been doing at the beginning of his speech, and referred to the withdrawal of certain services from centres. I am glad that my intervention in his speech was effective.

The withdrawal to which the Minister refers is closure, is it not?

I hardly need to refer the hon. Gentleman to the English dictionary for him to understand that there is a great distinction there. The withdrawal of processing facilities is taking place but the centres will remain as centres for blood donation and other activities; that is very different from closure.

I turn to the principles that lay behind the need for the reorganisation and what will underpin it. From the outset, the NBA has made the broad principles behind its proposals clear.

First, the blood service must remain a voluntary, unpaid donor system within the NHS. That is its great strength, as I have already acknowledged.

Secondly, we want to establish for the first time a truly national blood service based on high and uniform standards of safety, reliability and efficiency. Thirdly, we want to increase supply in line with increasing demand from increasing hospital activity and rapidly developing clinical techniques.

Fourthly, there is a moral obligation to use the generous gift of donors as efficiently as possible. That means working with hospital teams to use blood and blood products in the best possible way for each patient, to improve the safety and quality of the products and to make the services for donors better than they are now.

Fifthly, we want to collect blood at the most convenient locations for donors and ensure that the collection service is cost-effective. Sixthly, we want to rationalise administration to make it more efficient and effective and to remove waste arising from duplication, excess capacity or lack of co-ordination.

In summary, the proposals outlined in the consultation document are designed to increase supply; improve the way the blood supply is used; improve the safety and quality of blood products; improve services for donors; improve services for patients; and provide an efficient, cost-effective, national service.

The first step in the process was to establish the NBA and its main headquarters structure so that it could begin to plan. In effect, this provided a national blood service in name but the substance needed to be added to that. What are now under consideration are the NBA proposals to deliver the key second step of implementing the management arrangements that will convert the goal of a truly integrated national service into a practical reality.

The NBA consulted widely on its initial proposals in 1994 and gave full and detailed consideration to the responses received before arriving at the proposals which are before my right hon. Friend the Secretary of State.

On consultation, will the hon. Gentleman tell the House how many of those consulted agreed with the proposals and how many opposed them?

The hon. Gentleman says put it in the Library. If he tables a parliamentary question he will get an answer, as he would to a question on any other point.

The consultation process was wide and it has been validated. It was far wider than Opposition Members believe and the proposals that followed from it are now before my right hon. Friend, who expects to reach a conclusion shortly.

I find the cries that we hear from the Opposition on all such matters surprising. Faced with any change, the Labour party always in some way demands the restoration or retention of the status quo. Faced with the status quo, it always demands change. Faced with a consultation process it always demands more time; if due time is given for proper consultation, the next cry is, "Why the great delay?"

Throughout the consultation process, absurd and groundless fears have been raised by the Labour party. It has placed or provoked countless scare stories in the tabloid press. I seek to tackle the worst of them head on.

How many scare stories stores have we had about privatisation? They are not true. There is no question of privatising the national blood service.

We dealt with commercialisation earlier in the debate but let me make a final point on it. We produce vastly more blood products, as opposed to the main ingredients of transfusions, than we can use. The NBA disposes of surplus blood products such as factor 8, which is used in the treatment of haemophilia, by selling them abroad. That is a long-standing practice based on the sound and humanitarian principle that someone can at least benefit from what would otherwise be destroyed.

The NBA seeks to recover its costs without any element of profit at all. It is unfortunate that the accusation has been repeated tonight that the NBA is somehow getting inflated prices in places such as Turkey. That is rubbish. Price setting outside the UK has nothing to do with the NBA and is not within the control of the Government.

On the scare about the closure of blood centres, the transfer of certain functions, as we have already established in exchanges across the Dispatch Box, does not amount to the closure of a service.

I thank the Minister for giving way again. Will he admit that, buried within the Bain report, which is some 600 pages long, support was canvassed for possible privatisation but was dismissed. However, there was widespread support for the proposition that the English blood service should pursue profitable commercial opportunities outside the UK. How does the Minister square what he has just told the House with the information that is buried in the Bain report, which cost £600,000 of public money to produce?

I am telling the House the policy and what will happen. There is no policy along the lines suggested by the hon. Lady. The Bain report will not drive this process; it will be driven by the Secretary of State's decision, based on proposals put to him by the NBA.

The question of donor confidentiality has also been raised. I confirm, for the sake of donors, that information will remain strictly confidential and will not be made available to commercial companies for any purpose or under any circumstances. There is one simple reason for that. I remind the House that the relationship between the blood service and its donors is exactly the same as the relationship between a doctor and a patient.

As for scares about the safety of supply, it has been wrongly suggested that reorganisation will somehow prejudice security of supply. At present, excess capacity in processing, testing and grouping blood is about 50 per cent.

The hon. Member for Newcastle upon Tyne, East made what he thought was an amusing remark about a possible debate on how many pints of blood it is sensible to use in a particular operation. The practice varies across the country, and one purpose of reorganising the service is to establish credibility in the clinical techniques for transfusion so that there can be a proper level of supply for certain operations. If it now ranges, as it often does in orthopaedic surgery for the same procedure, between zero pints and some 2.5 to 3 pints or even more, one of the clinicians has clearly got it wrong. The transfusion service needs to develop its clinical abilities and disseminate them across the country so that a proper view can be taken.

The new service will have three prime objectives: an improved service to donors, an improved service to hospitals and their patients, and lower operating costs and less bureaucracy by removing the present duplication, variation and wasteful use of resources. The hon. Member for Newcastle upon Tyne, East is fast enough to ask questions at the Dispatch Box or on the Order Paper about management costs in the health service. I should have thought that he would welcome the objective of cutting out bureaucracy in our national transfusion service rather than seeming to be entirely against it.

I said in my speech that the efficient running of the service was an objective of ours as well as a claimed objective of the Minister. I raised two important constitutional matters with him and I hope that he will deal with them both before he sits down.

I shall indeed. On the hon. Gentleman's first point, a number of people have been employed by the service with a view to putting planning into effect. That is common practice where change is proposed. It would be absurd to suggest that a service facing change should not plan for it and put in place the proper structures to do so. I do not know quite what the hon. Gentleman suggests. Had that not been done, I bet that he would have suggested that there had been a failure of anticipation and would have said that the seamless service now provided by the blood transfusion service had been prejudiced.

The hon. Gentleman's second point, which he always makes, was about gagging clauses. The position is simple. Everybody has a right to talk to his or her Member of Parliament if he or she so wishes. The rules that will affect people in the National Blood Authority are the same because it is a special health authority. It is not a quango, as has been suggested in the House tonight. The rules are the same as those that affect any other employee within the family of the national health service, and the same standards apply.

As has been pointed out in letters issued by the chief executive of the service, it would be absurd if a Member of Parliament were the first resort without exercising the right to talk to the direct employers. So the point made by the hon. Gentleman has no worth at all. My right hon. Friend has taken, and is taking, the keenest interest in the revised proposals submitted to the Department in early July. It is clearly important for the future of the service that decisions are taken as quickly as possible, but it is even more important that they are the right decisions.

I am concluding my speech.

The principles on which those decisions will be taken, and on which this important service will continue to be based once they are taken, are ones on which the House, the country and donors will be able to rely.

8.5 pm

First, I declare an interest in this debate. My candidacy at the general election is sponsored by Unison, a trade union that represents a number of the staff affected by the proposals that we are considering tonight. I also have a constituency interest, which is that many donors and users of the service in Liverpool have expressed their concerns to me. Secondly, surgeons and consultants at the cardiothoracic centre, which is a regional centre providing treatment for heart and lung disease, have expressed their grave concerns, not only to me but to Ministers, about the proposals. I shall return to that shortly.

The Minister said that if we were to table a question, he would place in the Library a list of the people who had responded to the consultation document. On 9 February 1995, my hon. Friend the Member for Barnsley, Central (Mr. Illsley) asked whether the Secretary of State would
"publish (a) all the responses to the National Blood Authority consultation document and (b) a list of all the organisations and individuals who have opposed the reorganisation proposals".— [Official Report, 9 February 1995; Vol. 254, c. 367.]
The answer was that those were responses to the National Blood Authority and that therefore the replies were the property of the NBA. Will the Minister publish that information if we table a question now directly to the Secretary of State?

I support what the hon. Lady says. She will recall from our meetings that John Adey assured us that there would be a rethink if clinical opinion were opposed to the changes. How can there be a rethink if we do not know what clinical opinion was—most of us could have a guess—and if the Government will not publish the responses?

I agree with the hon. Gentleman. At that public meeting he had a further assurance from the platform in front of hundreds of people in Liverpool's St. George's hall.

A member of the Liberal Democrat party, Councillor Frank Doran, asked of the Mersey NBA:
"The Liverpool centre is an acknowledged 'centre of excellence'. An assurance has been given that no changes will be implemented if clinical opinion remains opposed. If clinical opinion remains opposed will the changes still go ahead?"
The National Blood Authority replied:
"Clinical opinion has been listened to very seriously and further meetings held. Sir Colin has met with the Mersey branch of the BMA, which is concerned about whether the proposals are workable and deliverable."
That was it. It was no answer at all. Clinical opinion throughout Merseyside remains extremely concerned about the proposals.

From as early as February this year, a referendum has been conducted among senior clinicians in Merseyside, north Wales and the Isle of Man. More than 300 top clinicians have stated that they are strongly opposed to the proposals because of the risks to patients' lives.

The former Secretary of State was sent a copy of the results of that referendum, which I am afraid demonstrates that the Government are prepared to ignore clinical opinion to drive through a change that, as currently proposed, is not in anyone's interest.

I can tell the Minister exactly the risks about which the clinicians are concerned.

The problems encountered in north Wales and Merseyside have been repeated in south Wales, where the specialised screening unit at Cardiff is to be transferred to London. None of its skilled staff are able to transfer, which means that an extremely valuable facility will be lost not just to Wales but to the whole country.

Before I outline the risks, I should like to deal with the survey of clinical opinion that was taken on Merseyside. Given the failure of the NBA to reiterate assurances previously given, will the Minister now offer them to us? Will he say that so long as clinical opinion remains deeply unhappy about the proposals he will not force through a closure that his own professional staff have told him they do not believe to be in the interests of patients? [HON. MEMBERS: " Answer"] We do not want any more weasel words; we want a straight answer to a plain question. I was asked to outline the risks, but they have been dismissed by Ministers. That is outrageous.

The hon. Lady knows perfectly well that it is not the outcome of a referendum upon which Ministers make their decisions. Proper clinical judgments will be considered and will form part of my right hon. Friend's decision. The hon. Lady is talking about petitions that are circulated and simply signed—I do not know on what basis. They are not what I would represent as clinical opinion in the sense of providing the best basis of evidence upon which to proceed.

I do not think that anyone listening to the debate will accept that response.

My hon. Friend will have a copy of a letter from Sir Donald Wilson, the chairman of the regional health authority on Merseyside. He is hardly a friend of the Opposition, but he, too, is opposed to the proposal and has written to say so.

My hon. Friend is absolutely right.

Clinicians and cardiothoracic surgeons at the cardiothoracic centre in my constituency in Liverpool expressed their concern about the proposal last October in a letter to Sir Colin Walker, the chairman of the NBA. They stated:
"The figure you quote of two hours travelling time in an emergency as a maximum is far too long for the work that we undertake. In the sorts of emergencies that we deal with, such a delay will result in the death of a number of patients."
That is quite plain and straightforward. Those are the risks and it is disturbing that Ministers are prepared to dismiss such comments.

Given the way in which the hon. Lady puts them, I am certainly not prepared to accept that they are accurate. Let me remind her that hospitals keep their own store of blood and often it is sufficient to last them for at least one, two or perhaps even more days. Secondly, the standard of two hours is an absolute maximum time. Many hospitals will still be able to receive supplies if they need to call upon them within a far shorter time. Therefore, for the hon. Lady to suggest that two hours will be the norm for anyone who needs to call upon a blood supply is rubbish.

I am not making a suggestion but quoting directly from a letter written by clinicians and surgeons at a hospital in my constituency who are deeply concerned about the proposals.

Does my hon. Friend agree that concern has been expressed by clinicians across the country? For example, the regius professor of medicine at the university of Oxford has written:

"This is a complex hospital with both a busy Accident and Emergency service and a number of specialised services, particularly related to diseases of the blood. We remain unconvinced that a safe and effective service could be maintained for the local population if it were centred in Birmingham or Bristol."
People will know who to believe between the Minister and the regius professor of medicine.

My hon. Friend is absolutely right. I do not intend to say any more on that subject, but I will ensure that clinicians at the cardiothoracic centre at Liverpool receive a copy of Hansard so that they can see how their concerns have been dealt with in the House.

In their letter to the chairman of the NBA, the clinicians and surgeons also said that without the services of the local blood transfusion centre they would have to "dramatically increase" their in-hospital blood stores. The Minister is quite right to say that hospitals have their own stores, but those clinicians have said that they will have to "dramatically increase" them. That is one way in which the notional £10 million saving that the blood transfusion service claims will be made will be passed on to hospitals. The real savings to the health service must be seriously questioned in the House, especially since we have been unable to get to the bottom of the figures produced during the whole sorry business. The clinicians also said in their letter:
"This whole process would be both costly and wasteful of donated blood and blood products."
New information technology systems have been proposed. I am pleased that the NBA has agreed that the new system should operate in tandem with the old one for a pilot period of six months. That is a great relief because the original proposal was to introduce and operate the new system from a standing start. I have been disturbed, however, to hear about plans to trade access to lists of donors in exchange for sponsorship of donor sessions. I firmly believe that throughout this process donors have been treated with scant respect by the people who manage the National Blood Authority and the blood transfusion service.

I have listened with great interest to the hon. Lady. I also represent part of Merseyside and I have had considerable correspondence on this matter. The hon. Lady obviously knows a great deal about the issue. Is she suggesting that the present arrangements governing the blood service on Merseyside are absolutely perfect? Is there no room for improvement and, if so—I presume she knows it all—have the clinicians who have come to her door in droves suggested any?

The hon. Gentleman need not be patronising. I do not claim to be an expert. His question is a fair one. None of the staff involved in this process have said that they oppose change full stop. I would be the first to recognise that the introduction of a national information system to which all centres have access, as well doctors and clinicians at every hospital, is an improvement on current services. I welcome that.

Donors are concerned at being treated in a cavalier fashion by the managers of the service. They are concerned that their trust in the service has proved to be misplaced. A press report, which has been denied, but the rumours continue, suggested that access to the lists of donors kept on computer was to be sold. I have already referred to sponsorship. Donors could be invited to a centre and, with their invitation, might receive advertisements for Ribena and McVities. Concern has been expressed to blood transfusion staff that donors have lost their free supply of biscuits as a result of that story. Such is the attitude of senior managers in the blood transfusion service. It is symptomatic of the way in which they have dealt with the whole business. Their cavalier attitude has been appalling.

I should like to quote a direct example of the attitude of those managers by quoting from Sir Colin Walker, who had a meeting on 12 September with representatives of Liverpool city council.

In order to extol the virtues of the new information technology system, the chairman said:
"If someone in Liverpool"—
for example—
"was brought in needing an urgent infusion of a rare blood group and the local donor"
was
"away on holiday—then, rather than having to ring around, the doctor"
dealing with the patient
"could tap into the computer and find that the unit of"
the required
"blood was in, say, Taunton."
Councillors expressed incredulity that blood could be brought from Taunton to Liverpool in any short time, let alone two hours. Sir Colin remarked that there was a good rail network between Taunton and Liverpool. But then he conceded that perhaps that might have been a bad example to use.

That is a typical example of the way in which the people responsible, placed in that position of responsibility by Conservative Ministers, have dealt with that process. It has been a public relations disaster. Donors have been dismayed, to say the least, by the way in which their trust has been betrayed. It is about time that Ministers took seriously the anxieties that are being expressed by hon. Members on both sides of the House.

8.21 pm

The more sophisticated our medical techniques become—with the obvious exception of keyhole and laser surgery—the more we depend on regular supplies of blood products prepared to the highest standard. We are one of the few countries—it is a proud boast—where donors give blood freely, unlike other countries, where it is paid for.

That being so, it is the clear duty of a Government to ensure that that freely donated blood is collected as conveniently as possible from donors in the best possible surroundings and prepared and used in the most effective way for the benefit of patients.

Few, if any, services can more truly claim to be life saving than the blood transfusion service, and no hon. Member in the Chamber tonight can know when we may become grateful recipients.

We are fortunate in having an excellent blood centre in Lancaster and a devoted and committed rota of donors, especially anti-D donors, of whom we have no fewer than 14 per cent. of the national total. We serve eight hospitals in the region, including the Victoria hospital, Blackpool and our local hospitals, and they have a right to expect a high standard of service.

I am proud that 20 of our local plasma donors recently took part in the study of a revolutionary antibody to help mothers with rhesus-negative babies, yet another feather in Lancaster's cap.

When the National Blood Authority's proposals were first published, many of the donors feared that they might have to travel to Manchester to donate blood. I do not know how that rumour got around, but it certainly did get around and it took a great deal of uprooting. However, I am happy to say that that fear has been put at rest. As the Minister emphasised, donors will continue to be able to donate locally with the teams who have worked with them so long—and the relationship of donors and teams who have serviced them is crucial.

However, the building from which our centre now works is a long way out of the city and it is far from ideal, in spite of efforts to make it as good as it possibly can be. Currently—and we have been striving for that for 20 years, to my certain knowledge—we are in the process of completing phase 3 of the modernisation of the Royal Lancaster infirmary, due to be finished in January. I should very much like consideration to be given to transferring the blood centre to the new RLI, where it could have purpose-built facilities and vastly improved conditions for donors and staff, and an even closer liaison—if that is possible, because it is already very close—with haematologists at the hospital.

The uncertainty that has prevailed for the past year, which was mentioned by Opposition Members, has been bad for the morale of donors and their teams. If the suggestion that the Secretary of State should visit all centres and that service provision be altered were to be adopted, that uncertainty would be unacceptably prolonged. Already, skilled staff are applying for jobs elsewhere. We cannot allow that haemorrhage to continue, or the service that we all wish to protect really will be endangered.

I should like the Secretary of State, who already has all the information regarding the Lancaster centre in his possession, to make a quick decision.

On a quite different subject, there has been a great deal of misunderstanding and misrepresentation about the sale of blood products abroad. Yesterday, I received an excellent, well-balanced letter from the Haemophilia Society—it is an exceptional society—on that subject. It said clearly that the society does not object in principle to the sale of surplus stocks of blood products, provided that does not cause shortages in the United Kingdom and that income earners remained in the national health service.

I am bound to say that I would go further than that and require the money to remain within the NBA for the constant improvement of the service, where technology is evolving with frightening rapidity. We must keep up with the best available techniques. It is our duty to do so and not to waste that valuable product.

The chairman of the NBA, Sir Colin Walker, gave his assurance when he came to talk to donors and staff at our centre last year. He has been several times, not only that time. He said that the only alternative to selling surplus product was to burn it. Hon. Members should have seen the expressions on people's faces when he said that, but that happens to be the truth. I did not know that. It is the only sensible, clean way of disposing of it. That appears to be an awful waste.

Obviously, not all blood components are required in equal quantities, as Opposition Members admitted. It is entirely logical, highly to be recommended and in everyone's interest to earn money on surplus product, as I am sure that no donor would like to feel that any part of his blood had been burnt.

In all our discussions, we must never forget that it is the donors who give their blood freely and regularly whom we must consider. They are the star performers in the act. I believe that a spanking new centre at the RLI, in the centre of the city, would be perfect for them. I urge the Minister to pass on what I have said to the Secretary of State, to ensure that that is the solution he chooses—and quickly, so that our excellent centre can continue happily and efficiently with its life-saving work.

On a point of order, Mr. Deputy Speaker. I understand that activities may be taking place in the Committee Room upstairs that have recently been outlawed by the European Court of Justice, regarding the elections to the Labour shadow Cabinet, which—

That is nothing whatever to do with the Chair, and the hon. Gentleman well knows it.

8.27 pm

The voluntary principle has been mentioned by several hon. Members. It is the crucial principle underlying the existence of the blood donorship scheme in this country. No one in the House would wish that voluntary principle to be lost to the country.

The National Blood Authority appears to have harmed the reputation of that voluntary system in the way in which it has mistakenly allowed some aspects of the sales abroad of factor 8 to take place.

I belong to the school of thought that believes that it would be ridiculous to throw away surplus blood products for some xenophobic reason. I doubt that many people in the House believe that one should throw away surplus factor 8. It should be made available to others who need it. If possible, in the light of the voluntary principle, it should be given to those needing it in other countries. As the Minister of State said, it may be that there are difficulties in doing so for international legal reasons. Also, it is a reasonable argument that the National Blood Authority should cover its costs. I have no quarrel with it for doing that.

In his speech, the Minister of State, who is a lawyer, seemed to be being extremely naive in imagining that it was not possible to regulate, quite simply, what happens to factor 8 after it is sold abroad.

I have in my hand a copy of a price list taken from a Turkish publication. My Turkish hardly runs to a restaurant menu, but it is plain from the price list that blood products—indeed, factor 8—which can be traced to the National Blood Authority, and which has been sold by it, is being sold on at a profit margin of about 450 per cent. I do not understand why the National Blood Authority, when selling that important product abroad, cannot establish in its contracts of sale enforceable conditions to ensure that that does not happen. It is quite normal for international contracts to contain restrictive conditions on what should happen to the product that is sold. It happens regularly with regard to defence material and I do not see why it should not happen in relation to blood.

Bearing in mind the voluntary principle, I ask the Government to reconsider the issue. Is it right that blood products donated freely by people in Britain should be the subject of profiteering by middle men, whether in Turkey or in any other country, when there is a means available to prevent it? Why, at least, does not the National Blood Authority, urged by the Government, try to improve that unhappy and unsatisfactory trade? It is not simply a question of the morality of the contracting procedures, but of whether the National Blood Authority can justify the reputation that it must earn if the voluntary principle is to continue as successfully as before.

Does my hon. and learned Friend agree that one of the most scurrilous factors involves the question put to people in a survey which offered them the crude choice of whether they would prefer to have their blood products and donations burnt or sold? Does he agree that options other than those two stark contrasts are available? One such option is to give those blood products to people in underdeveloped countries who will not live beyond their twenties if they are haemophiliacs and unable to obtain factor 8. We should deny those people who profiteer in a commercial and exploitative way the opportunity of making money out of products that have been voluntarily given by people out of the generosity of their hearts.

As ever, my hon. Friend makes his point extremely well. It is right that people are entitled to expect that, when they are consulted about such issues, they are asked questions that do not ensure an answer that is to the Government's tune. It is a bit like having a referendum in Iraq on who should be the president without having more than one candidate.

The reorganisation proposals justify other criticisms—perhaps it is unfair to say that they are criticisms only of the National Blood Authority. It seems that the criticism could equally be levelled at the Government who, after all, have the disposition of the future of the National Blood Authority in their hands.

Hon. Members have already raised the issue of assurances, given by the National Blood Authority, which have not been fulfilled. I understand from my hon. Friend the Member for Liverpool, Mossley Hill (Mr. Alton) and the hon. Member for Liverpool, Broadgreen (Mrs. Kennedy) that that is particularly true of assurances given in meetings in Liverpool. It is plainly on record that John Adey, the chief executive of the National Blood Authority, underlined an assurance that had already been given by Sir Colin Walker. The assurance was made in the clearest possible terms. It was stated that unless a majority of consultant haematologists and other relevant medical experts in the area agreed that patient services could be at least maintained or preferably improved, the changes would not take place.

We have heard a lame suggestion from the Minister of State that the views of consultant haematologists and other medical experts are the property of the National Blood Authority and therefore we are not entitled to hear about them. Is it a new principle that Members of Parliament are not entitled to be told about consultations in relation to organisations that are part of the Government service, whatever their exact status? That does not ring true when we compare it with what we now know of what was going on in the Prison Service despite its agency status.

I am not seeking to draw a conclusion from what has been said by Opposition parties. I am drawing my conclusion from what is said in the Learmont report. It is clear that there are many precedents, of which the Prison Service is but one—Learmont provides some evidence— to show that Ministers can and do interfere in operational decisions, particularly those that determine the future of a service.

It is outrageous that the clinical opinion that has been given to the National Blood Authority is being concealed from Members of Parliament. One is bound to draw the conclusion that it is being concealed because it is not the same conclusion as that reached by the Government and the National Blood Authority's chief executive and chairman. When the Under-Secretary winds up the debate, I challenge him to tell the House that, having heard the views on the subject, he is prepared to place those representations in the Library of the House so that we can see what they were. It is perhaps an indication of the views of the consultant haematologists that the National Health Service Consultants Association recently passed a motion of no confidence in the National Blood Authority's proposals.

Another criticism that can readily and justifiably be made is that the strategic view has been founded on conclusions based on invalid premises. The most obvious one is the strategic review's fundamental conclusion that blood demand was rising at about 2.6 per cent. year on year. Since that was said it has been demonstrated and admitted that blood demand is now rising at 4 per cent. a year—a significant difference.

The point has been made again and again—it is right and fair to accept it—that blood collection is less affected by the proposals than processing and testing. But processing and testing are significant issues. We have heard some eloquent voices from Liverpool about the effect on that city. But my constituency, which is situated 70 or so miles from Liverpool, and all points in between, will be affected by what happens to processing and testing in Liverpool. Very little regard has been paid to issues relating to transport, cost of transport, and the consequences of delays in transport.

I can only presume that Sir Colin Walker was so confused by his geography that he mixed up Taunton and Wigan—or possibly Welshpool. [Interruption.] Does the hon. Member for Wirral, South (Mr. Porter) wish me to give way? It is always a pleasure to let him into a debate.

I was wondering whether, in some magic way, the hon. and learned Gentleman could put Montgomery closer to Liverpool than it has hitherto been.

Not at all. I am not sure when the hon. Gentleman last visited my constituency, but I can assure him that on the newer roads it is a good deal easier to reach a hospital in Liverpool than some of the much closer hospitals in Wales.

Another issue that seems to have been addressed on the basis of false premises is the cost of holding stock. It has not been possible to find any assessment of the cost of stockholding in the National Blood Authority's proposals. It is said that there will be a national saving of £10 million. However, one must question whether that will be so with the introduction of a completely new management tier, involving 25 senior managers.

As the Labour Front-Bench spokesman, the hon. Member for Newcastle upon Tyne, East (Mr. Brown), said, the appointment of so many new managers is unprecedented before reorganisation. I ask the Under-Secretary to inform the House whether the Government have taken advice from the Government Legal Service as to whether the appointment of 25 senior executives before reorganisation is ultra vires action on the part of the National Blood Authority. I believe that that may be the case as a straightforward matter of law.

The hon. and learned Gentleman raises an interesting point about the cost of holding blood in stockholder units. I believe that we must take into account another factor if the Manchester centre prevails in the production of blood. It will cost more to process blood per unit at that centre than at the Liverpool centre and hospitals in the Merseyside area have estimated that it will cost them an extra £3 million to buy the stocks that they currently purchase from the Liverpool centre. Perhaps the hon. and learned Gentleman should also take that sum away from the £10 million saving that Mr. Adey and his cohorts are trying to persuade us that they can achieve.

The hon. Lady, with her usual capacity for detail, has made a very good point and I accept what she said. As I understand it, eight key committees were established to advise the National Blood Authority steering group about rationalisation. The membership of the key strategy group could hardly be described as balanced. Liverpool had no representatives on the group, although Manchester did, and Liverpool is to be "reorganised"—to use the euphemism. Lancaster had no representative on the group, although Manchester did, and Lancaster is to be reorganised. I also understand that Oxford had no representative on the group and it is to be reorganised as well.

The Government were asking for trouble—which they now have—by attempting to make a well supported and rational economic change to an important public service without seeking proper representation from the areas that were most likely to be affected. The Government cannot run away from the fact that the public have no confidence in the Government's proposed reorganisation of the National Blood Authority. There are six main points to be made in that regard and I shall summarise them.

The reorganisation is founded upon conclusions, the evidence for which the Government are refusing to publish. Therefore, the case is unsubstantiated. The conclusions are based on inadequate consultation for the reason that I have given in relation to the membership of the steering group and for a whole host of other reasons that we may read about almost daily in the medical literature.

The assurances that were given—when at least three hon. Members were present—have been broken quite outrageously. As a result, the morale of service staff has been undermined. A long list of distinguished haematology experts who have worked in the blood service have left or are leaving as a result of the reorganisation.

Another point is that the Government have undermined donors' faith in the service and they will have to fight hard to restore that faith. All hon. Members hope that the Government will do so, but to succeed they will need to produce a reorganisation that is credible to the donors.

Finally, as the Minister's speech in the debate demonstrated, the Government and the NBA have conspired in a public relations disaster that is hard to parallel—even in the history of the Government's stewardship of the national health service. I hope that when Ministers mull over the debate they will decide that the proposals are flawed and that they will be revised substantially.

8.44 pm

The Brentwood centre in my constituency is affected by the proposals. I think that it is correct to stress the good work of the National Blood Authority. Our supply of blood is probably one of the best in the world, and only the Australian Red Cross comes close to meeting our standards. It is also correct to pay tribute to the many thousands of blood donors who freely give their blood and so guarantee a constant supply of high quality blood.

As a former member of a regional health authority, I can recall those early days when the fear of HIV was widespread and when we did not quite understand some of the problems associated with hepatitis. The National Blood Authority and the regional units moved quickly to ensure that our blood supplies remained trouble-free.

If we are to make changes to what is a very successful service, we must be certain that the changes will be lasting and that they will enjoy the support of the most valuable component of the service: the donors. I do not believe that there can be any substantial argument against the need for reform. With the reduction in the size of regional health authorities, we can make a case for moving to a zoning policy. A move to three zones should improve the management of the service and ensure an equalisation of supply. It makes not a jot of sense to ration blood supplies in some hospitals when supplies are available in other parts of the country.

It makes sense to have a system that allows computers to talk to one another so that shortages of blood products in one area can be matched to over-production in another. The problem with the report is that the devil is in the detail. The Bain report's recommendations fly in the face of many of its findings, and its recommendation about Brentwood is perverse.

I thank my hon. Friend the Parliamentary Under-Secretary of State for Health, who is in the Chamber, for his patience and courtesy in listening to my arguments and to those of my constituents. The Government should take their time and listen to such representations. However, the time for a final decision is approaching swiftly. A year is a long time, and we are beginning to see staff drift and a lack of authority within the service to make changes.

I congratulate the Labour party on its choice of motion today. It is quite a feat to complain about the time available for reorganisation while tabling a motion calling for an extension of the consultation exercise.

We come into contact with the national health service when we are ill. We do not often have an opportunity to give something back to the NHS—except through our taxation system—but blood donation gives the ordinary citizen an opportunity to do just that. In our stewardship of the national health service we must be accountable and that is doubly important when it comes to the blood service. There would be no service without the active co-operation of donors. The proposals must continue to attract donors and to enjoy their support.

Does my hon. Friend agree that the sort of scare stories that we have heard from Labour Members tonight may discourage donors from giving blood in the future?

I am afraid that my hon. Friend is absolutely right. We know from the Bain report that 70 per cent. of donors are happy with the current system and only 1 per cent. are strongly against it. The shift towards mobile collections must not risk jeopardising regular established collection sites. After all, we know that special donors attend the Brentwood centre to donate plasma and platelets and we must retain their confidence.

The staff of Brentwood blood transfusion service have not engaged in opposition for its own sake; they have certainly not engaged in the some of the silly scare stories or the nonsense about the sale of blood products. The hon. and learned Member for Montgomery (Mr. Carlile) said that he was not concerned with matters of xenophobia about the sale of factor 8 and then gave us a lecture on the perfidy of Johnny Turk in making a profit. We know where the Liberal Democrats stand. They would give the product to people abroad. That means that we would have to subsidise the product to go abroad as we would have to pay for its shipping, transportation and distribution.

If the hon. Gentleman had taken the trouble and had the courtesy to listen, he would have heard me say that it is our view that the National Blood Authority is entitled to cover its costs, so will he now withdraw the entirely false accusation that he made or will he perpetuate such a myth?

I am happy to clarify what the hon. and learned Gentleman has said on a number of occasions from a sedentary position. He said, "Let us give it." As the present arrangements are to cover the costs—exactly what he suggests—perhaps it might be sensible if he withdrew his objections and supported factor 8 which has no international boundaries. [Interruption.] The problem is that the hon. and learned Gentleman is jumping from bandwagon to bandwagon and he must understand that he will occasionally fall between them.

Is the hon. Gentleman in favour of the Brentwood proposals in the NBA report—that the Brentwood centre should have its heart torn away by having its blood production facilities shifted elsewhere? Is he in favour or will he join us in the Lobby tonight?

I shall come to that point in a few moments. First, I should like to give the views of the staff at Brentwood. I have had no problems with gagging; they have given me full briefing on all the matters concerned. Let us see what concerns them. They are not against the proposals in principle. They say in a detailed document:

"We acknowledge and support the following initiatives which would yield significant cost savings in the short-term:—
Zonal centralisation Administration, financial services (including payroll) and personal services.
Negotiation of purchase contracts on a national basis.
Rationalisation of low volume product production and low volume testing to fewer sites within the NBS.
The introduction of a national IT system to replace the various different IT systems in use."
So why are the recommendation about Brentwood wrong? It is not sensible to transfer Brentwood's facilities to Collingdale. I have yet to meet a health economist, clinician or health worker who thinks that it makes sense. Considerable sums of public money have already been spent on renovating the Brentwood centre, as my hon. Friend the Minister has seen for himself.

I understand the arguments about the storage of blood, but they must not obscure the arguments for having good regional coverage for the processing plants. The initial confusion of the hon. Member for Newcastle upon Tyne, East (Mr. Brown) does not help matters. Our objection is not about the centre, which would remain open as a storage facility, but about the removal of the processing plant. Brentwood transfusion provides reference services on a 24-hour, seven-day week basis for hospital users. Cross matching blood and antibodies is sometimes required urgently. To restrict facilities for Essex and the rest of East Anglia to Collingdale and Cambridge is not a good use of resources.

Essex, in common with the rest of East Anglia, is a rapidly growing county. Its population is growing rapidly. Brentwood is close to the M25, the M11, the A12 and the A13. Blood can be quickly processed and used from an area covering north London and beyond to the whole of East Anglia. Blood from the most remote part of our region can be returned for processing within a relatively short period.

We know from the Bain report that the optimum size for a processing plant is somewhere between 250,000 and 300,000 units per year. Brentwood processes 160,000 units, Cambridge 100,000 units and Collingdale 220,000 units. Collingdale is beginning to approach the upper limits of what Bain considered sensible. Collingdale and Cambridge have restricted sites and the need for blood products within the north London and East Anglia region will continue to grow. Additional space would have to be found in Collingdale to process blood from the north-east Thames region. Brentwood can easily absorb that expansion without any additional building. There is a possibility within the Brentwood centre for a second independent processing line. There is sufficient room to take all the processing from Cambridge.

Cambridge, in addition to blood processing, carries out outstanding research of the storage of human tissue. That work on human tissues is not dependent on its processing work. It is a restricted site and in my view it is in the best interests of the National Blood Authority and the national health service if Cambridge is allowed to continue its research and storage of human tissue and that its facilities for blood processing are transferred to Brentwood.

In conclusion, I ask my hon. Friend to make the decision as quickly as possible, to have high regard to the use of processing and the work of Brentwood and to ensure that, in the retention of Brentwood, we have the possibility of ensuring that a growing region has the facilities to process blood.

8.57 pm

First, I should declare that I am sponsored by Unison, which has members who are affected by some of the proposals as they work in the blood service, but no personal payment is made to me as a result of that sponsorship.

We need to assess what has been going on. I pay tribute to the hon. Member for Brentwood and Ongar (Mr. Pickles) for the work he has been doing in his own area to try to preserve the facilities that he discussed so eloquently. We have been doing similar work. Many of us agree with and recognise his plea that to remove the processing part of a transfusion centre is to rip out its heart and thereafter it is difficult for it to retain its specialist services and operate as anything more than a glorified fridge.

I pay tribute to the hon. Gentleman, but I shall take the same line as I make a plea for the Liverpool centre. The people of Merseyside have affection for it and know how vital it is to their own well-being. I am not going to plead for the Liverpool centre to be kept open at the expense of another centre. I believe that the entire approach to the rationalisation that we have been discussing has been fundamentally wrong, and that we must take a completely new look at the issue.

The motion suggests that the Secretary of State should visit all five centres that are threatened with—I will continue to call it closure. As the hon. Member for Brentwood and Ongar pointed out, when we take processing facilities away from centres we are effectively taking the heart out of them. "Closure" strikes me as a reasonably accurate description of what is planned for these centres—and it is the description that the National Blood Authority applied from the beginning in its consultation. It began to drop the term only when it realised what the opposition was.

I associate myself with all that has been said about the precious nature of our donor system, which is based on altruism and relies on trust and confidence. No one, I hope, would deny that it is the highest-quality system of blood provision that any country has managed to design so far. We should all be very proud of that, and pay tribute not only to donors but to the staff who work in the centres and to the national blood service. I am careful not to call it the National Blood Authority, as I have had a rather lower opinion of the body since it was made a special health authority in 1993—partly as a result of my own dealings with it, which I shall mention later.

Why, then, are we trying to introduce a fundamental, root-and-branch reform of a system that has worked so well? Why are we trying to force that reform through? Why was the decision made in secret, and why are we not allowed access to the results—

It was made in secret, by committees—and, as the hon. Member for Brentwood and Ongar pointed out, Liverpool was not represented on the committees that decided that that centre was to close. A good deal has been wrong with the way in which the reform has been planned.

Does the hon. Lady not accept that there has been a consultation procedure and that, until a decision has been made following that procedure, nothing has in fact been decided?

I only wish that that were true. A zonal system is already operating, however, involving 25 new jobs and very large cars. There is a sense of inevitability about the whole business. The process and our trust in the service have been undermined by the way in which members of the National Blood Authority—particularly Sir Colin Walker and Mr. Adey—have conducted themselves during the past year while the so-called consultation has taken place.

Let us examine the history. First there was the Bain report, which, as was pointed out earlier, was set in train six months after the creation of the new special health authority—the National Blood Authority. After some rather dubious procedures, it came up with a saving of what it says was £10 million out of the overall cost of running the service—£135 million. The consultation document, however, contained few figures and no facts. There was no way of proving where savings could be made, and no obvious sign that any detailed work had been done to establish that. The figures seemed to have been plucked from the air.

The report—all 600 pages of it—cost £682,000 of public money to produce. Bain and Co. also carried out a consultancy job for the National Blood Authority on the future of the bio-products laboratory, which cost £350,000 of taxpayers' money. Of the £1.25 million of taxpayers' money that the National Blood Authority spent on consultants' reports last year, Bain has taken home £1,032,000—a large proportion of the total and, in my view, money for old rope, given the understanding of the workings of the system displayed in some of its recommendations. I consider its standard of work lamentable. It has little understanding of the technical side of blood collection, let alone any idea of the concept of altruism and the "gift relationship" that is so special and central to the way in which our blood service operates. I suppose that that is to be expected.

I am concerned about a number of the proposals, but I shall mention only three. It is clear that Bain canvassed management reaction to privatisation; having said that the idea had been dismissed, it found considerable management support—after circulating a questionnaire—for the idea that
"The English blood service should adopt a more commercial attitude".
It also found overwhelming support among managers for the proposal that the bio-products laboratory should
"sell surplus blood products outside the UK",
and the proposal that
"The English blood service should pursue profitable commercial opportunities outside the UK".
That is a wide-ranging statement, which does not refer just to the sale of surplus blood products. Goodness knows what other "profitable commercial opportunities" are envisaged. There was even more support for selling plasma. There is a hint of commercialisation, if not privatisation, in all this.

No. I am in the middle of dealing with an issue.

I can demonstrate that Bain did not know what it was talking about in other parts of the report as well, and adopted a wholly inappropriate attitude to the gift relationship and donors in particular. It seems that efficiency is measured by the number of pints of blood collected per employee, which strikes me as rather an unfortunate view of what success should mean in a national blood service. The report then glibly argues:
"Collection teams can be easily designated to collect 140-plus donations per day".
We already know that 30 per cent. of all blood supplies are collected from donation points. Fewer than 90 pints are collected each day. People give blood to nearby villages; they do not want to have to traipse to some central point. They want to go to the local church hall and have a cup of tea with the person who has always collected their blood before giving it. The report suggests, however, that it is not economical to organise collection points for fewer then 140 donations a day. It goes on to say—I can only think that a time-and-motion study was carried out—that a rapid through-put system would enable that target to be reached—that being the "efficient" level of donation.

So, in this 18-minute process, 2.3 minutes are allocated to checking people in; 2.4 minutes to screening and questioning, just to check that the blood products to be donated so kindly are safe; 3.5 minutes to a quick haemoglobin test; and a frantic 9.8 minutes to taking the unit of blood. Rules are already in place—this fantastic firm of consultants who were paid so much did not seem to know anything about them—stating that 17.5 minutes is the minimum time in which to take a pint of blood, for all kinds of reasons. That means that the maximum throughput possible for a bloodmobile of the sort that would go to local villages is 60 or 70 units a day, barely half the recommended efficient amount—which just goes to show how much the consultants understand about blood collection and about what donors want.

The consultants also decided to take a look at keeping the blood at room temperature, to see whether that would be a viable efficiency saving. They concluded that it would, saying:
"room temperature hold is a most desirable approach from a logistical and cost perspective … estimated saving potential £500,000".
Thus, to save £500,000, they recommended doing away with fridges. After all, people have to check that they are at the right temperature, which requires staff. Doing away with all those visits to the fridge would surely ease work scheduling and reduce processing and testing costs. The consultants add, at the bottom of the page, that there would be a
"risk of enhancement of selected bacterial growth".
That just means that someone given a bad bag of blood will die or become seriously ill.

It is astonishing that people can come up with such ideas and then write them down. If I had paid £600,000 for such a report, I would feel seriously cheated—but of course the National Blood Authority is not paying for it out of its own pocket. The money is coming from taxpayers' pockets, so Sir Colin Walker can rest easy in his bed.

The consultation document that emerged from this fantastic piece of work was disgracefully shoddy: a masterpiece of doublespeak. It contained very few facts, and had clearly been written back from the conclusions that it created. Graphs were included, but without the relevant identifying axes, so no one could take a close look at what they really meant. They were meaningless, as any GCSE mathematics student could point out. The axes that appeared in the Bain report were removed because the published graphs showed that some of the centres it was felt should close were more efficient than the ones that were to be kept open.

That sort of approach is not only dishonest; it is shoddy and amateurish, and it immediately creates the impression that the wool is being pulled over people's eyes. It dissipates any confidence that we have in management when we see them employing such techniques.

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