On a point of order, Mr. Speaker. Would it be possible to know whether the appeal by the House of Commons Commission to the Appeal Court is limited to the question of addresses, or extends to the wider question of second homes? If it is the former, that would be perfectly understandable on grounds of security. If, however, the appeal against the information tribunal is on the wider question of expenditure on what are described as second homes, it should be noted that some Members, certainly myself, are very much opposed to the appeal being lodged. In my view, it is unfortunate that no way of voting—

Order. This matter is before the court, and while I know that the media can talk about it, the rules are clear that it is sub judice for the House of Commons, and I cannot discuss it. In relation to many of the questions that the hon. Gentleman raises, there is nothing to stop him going to the court and finding out the grounds for the appeal.

I inform the House that I have selected the amendment in the name of the hon. Member for Chipping Barnet (Mrs. Villiers).

I beg to move, That the Bill be now read a Second time.

May I give the apologies of my right hon. Friend the Secretary of State for Transport, who is unwell today?

Reliable, high-quality public transport makes a real difference to people in their everyday lives. We depend on it to get to work, to the shops, to essential services such as schools and hospitals, and to visit friends and family. It can help to promote social inclusion, particularly as the most vulnerable in our society often depend on public transport to the greatest extent. Good public transport also helps to tackle congestion, contributing to improved economic performance and the fight against climate change.

The bus has always been the workhorse of the transport system. Back in the 1950s, up to 13 billion journeys across the country were made by bus each year. Sadly, for the rest of the last century, the number of people using buses fell year on year. The previous Tory Government’s solution in the mid-1980s was to deregulate the bus market outside London. Too often, that led to services being cut back, and in some places aggressive competition in the form of bus wars gave the industry a bad name. That is why bus patronage fell from 5.8 billion journeys a year across the country in the mid-1980s to below 4.4 billion by the late 1990s.

We on the island are hopeful that the Office of Fair Trading will be persuaded to look into market failure regarding ferries. However, provision of free public transport for elderly people is outside its remit. Elderly people can travel by bus, free of charge, when visiting relatives in other parts of the mainland. Why are my elderly constituents penalised by being forced to pay for a ferry if they want to visit a relative outside their constituency? I hope that that is something that the Minister can look into.

I am not sure why the hon. Gentleman is bringing the OFT into this. I think he is referring to the national concessionary fares scheme, which we debated in the House last night and the Labour Government introduced. He is right: something like 11 million people over 60 and disabled people will benefit from it this year, but it is true that that is confined to buses. It is open to local authorities to extend the scheme if they wish to do so. He may like to approach his local authority to see whether it wishes to extend the scheme to the ferry service, which it is at liberty to do with the discretionary powers available to it.

Will my right hon. Friend join me in congratulating South Yorkshire and West Yorkshire on not just giving free bus travel to all people over 60, but giving free train and tram travel too across the boundaries of both metropolitan districts?

My hon. Friend is right to highlight South Yorkshire as an exemplar of good public transport provision. I am glad to say that it has continued—like, I have to say, some Conservative and Liberal Democrat councils—the concessionary fare schemes that were previously available. It obviously shows that Labour councils value older and disabled people and want to give them those extra services on top of the national concessionary fares scheme, in which the Government are investing something like £212 million this year.

My right hon. Friend will know that Merseytravel is now the most successful rail operator in the country, offering on-time delivery more often than any other provider. However, that has been brought about only by the significant investment that this Government have placed in public transport on Merseyside, an area with the least car ownership and where people are absolutely reliant on public transport—£13 million was spent in 1997; it is now well over £60 million. Merseytravel delivers the sort of services that people, quite frankly, have a right to.

My hon. Friend is right to point in particular to some of the integrated transport schemes that have been developed by some of our successful passenger transport executives. The idea of the Bill is to enable them to go even further in improving public transport, in contrast, as I said, to the Conservatives, who during their time in power deregulated the bus services, causing enormous problems for all our constituents.

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I shall give way to the hon. Gentleman first and come back to my hon. Friend.

As the Minister knows, the Liberal Democrats will probably support the Bill, but may I take up the point that she made earlier about concessionary bus fares? I do not wish to revisit last night’s debate, but it is simply not true that local authorities do not care about the extra discretionary services. All local authorities of all parties want to provide such services, but there is a genuine issue over funding. Will the Minister give me the assurance that she would not give me last night? Will she undertake to conduct a review after, say, a year to establish whether or not the formula that the Government have applied is fair to local authorities? She needs to do that.

Clearly we are revisiting last night’s debate. As I have said, about £1 billion will be invested in concessionary fares this year, including an extra £212 million. We believe that that is a generous settlement, and that there is no need for local authorities to cut the services that they provide for elderly and disabled people.

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I must give way first to my hon. Friend the Member for City of Durham (Dr. Blackman-Woods).

Will the Minister confirm that the Bill will allow local authorities such as Durham county council to draw up plans to improve public transport, particularly bus services, and to create better integration between commercial bus operations and, for instance, community transport initiatives so that they can start to deliver for their populations in a way that was not possible before because of the last Government’s lack of investment?

My hon. Friend has highlighted three points: the way in which the Bill will improve bus services, the integration of transport services that it will allow, and the fact that it will allow better planning so that our constituents can benefit from the improved public transport that we all want.

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I know that what I am about to say will interest my hon. Friend the Member for Preston (Mr. Hendrick), and I will give way to him in a second.

Under the deregulation introduced by the last Government, competition became very aggressive. That led to bus wars in some parts of the country, and gave the industry a bad name. We saw a fall in bus patronage across the country under the stewardship of the last Government, and the Bill is intended to put that right. In stark contrast to what the last Government did, this Government have been reversing the legacy of underinvestment that we inherited in 1997, and have made it a priority to get people back on to buses.

I thank my right hon. Friend for visiting Preston recently to observe and discuss its Civitas programme. She will be well aware of the current bus wars between the Stagecoach bus company and Preston Bus. How will the Bill facilitate improvement in services, given the problems that deregulation has caused in places such as Preston?

There are instances in which it has not been in the public interest to provide services that do not meet our constituents’ needs. I will not comment specifically on my hon. Friend’s area because I know that the traffic commissioner is undertaking an inquiry, but I am aware that he has followed developments closely and has been very concerned about the effect on his constituents. However, there are a number of ways in which the Bill allows local authorities to plan services more effectively and introduce better quality partnerships and, if necessary, quality contracts. I will say more about that shortly.

We shall be able to reassure our constituents that their real needs will be considered. It will be possible to sit down with bus operators in a spirit of co-operation, and discuss how it can best be ensured that services meet the needs of local people. The Bill provides a range of ways in which that can be achieved.

If the Minister is so strongly opposed to the deregulated system that the Government inherited from their predecessor, why is it that in 10 years all they have done is introduce two schemes, quality contracts and quality partnerships, that have been used by no local authority except one that has used a quality partnership? Clearly the Government’s concern about the present system has not motivated them to do anything to amend it.

That is an interesting comment, because I understand from it that the hon. Lady believes that the introduction of quality partnerships and contracts should be encouraged, so I am surprised that her reasoned amendment says her party will vote against the Bill because of the introduction of quality contracts.

I would be the first to say that we need to go further than the powers available in the Transport Act 2000. It has been recognised that the threshold was set too high, which is why we are changing the legislation, improving on the 2000 Act to make co-operation easier. I am astonished that the hon. Lady and her party do not recognise their constituents’ concerns, and wish to vote against the Bill because of the introduction of quality contracts.

The concessionary fares scheme for elderly people has been enormously successful and popular. Does the Minister agree that exactly the same arguments that supported the case for a national concessionary fares scheme for the over-60s also support the case for such a scheme for the under-18s? Will she keep her mind, and the collective mind of her officials, open to the possibility that when considering the next transport Act we should look seriously at introducing a national, standardised, basic minimum concessionary fares scheme for under-18s?

My hon. Friend reinforces the point that without a Labour Government there would not have been a national concessionary fares scheme at all; in particular, it would not have been possible without the extra investment that the Labour Government have put in. Of course, any extension of schemes requires extra investment. We are doing lots of things to encourage younger people to use public transport—and we also encourage other initiatives, such as cycling schemes to make sure that they get the benefits of exercise.

I take on board my hon. Friend’s point, but we must consider it in the context of the investment we are already putting into the bus industry. About £2.5 billion each year goes into bus services, up from just £1 billion a decade ago. It was this Government who introduced the rural bus subsidy grant, and since we came into office we have nearly doubled it to £55 million a year. That means that over the 10-year period we have spent about £450 million a year subsidising rural bus services.

As we debated in the House last night, the investment we are putting in through the national concessionary fares scheme gives about 11 million older and disabled people the freedom to travel free on any off-peak local bus in any part of England. That scheme has boosted the number of people using buses, and has brought people greater freedom and independence. As a result of all the changes and investment I have outlined, almost 500 million extra journeys are being made each year on local buses since 1998.

The Minister mentions rural areas, but what is her view of the EU driving times and rest periods directive of last April which bans drivers from covering more than 31 miles at any point in a single trip unless they have had a 45-hour period off in the same week? That is causing mayhem in counties such as Norfolk. A firm called Norfolk Green has contacted me about it, saying that it will have to cut a number of rural services. Is this not another example of crazy Euro-interference in our own business?

The hon. Gentleman would do well to remember that that measure was brought in on safety grounds. We should not underestimate the importance of that. However, I understand that the matter is being examined by the Vehicle and Operator Services Agency, and that the bus operators will shortly be meeting to discuss how the directive can be successfully implemented. It is important to remember that it was to do with safety issues about which we should all be concerned.

As I said, the 2000 Act created new opportunities for local authorities to work with bus operators towards real improvements for the benefit of passengers. It included measures to support voluntary partnership arrangements between local authorities and bus operators, and gave powers to local authorities to implement quality partnership and quality contracts schemes.

The Government have been getting it in the neck from both local government and the private sector, which may suggest to some that perhaps they are on the right track. Does the Minister agree that the Bill’s success will be tested in how the bus companies and local authorities come together to solve the problems that exist in providing services to communities that are not well served by bus companies? The real test of the Bill’s success when it is enacted will come when local authorities and the bus companies start seriously to talk together about improving services.

My hon. Friend is right, and I thank him for the work that he did in the Transport Committee, scrutinising the Bill. It allowed us to make amendments to the Bill to improve it, and I shall come to those later. He is right to say that the Bill’s success will depend on its practical implementation and the relationship that can be built up between local authorities and the bus operators in a positive way for the benefit of bus users.

As I was saying, the actions that we have taken during the 10 years of the Labour Government have made a real difference. They have meant the development of not only the partnerships to which reference has been made, but the partnership between central and local government. It has meant that we have managed to halt the decline in bus usage and delivered the first sustained year-on-year increase in patronage. About 500 million more journeys are made than was the case 10 years ago.

What the Minister says is right, and I have seen the improvement in my constituency. Some 10 days ago, a consultation document on subsidy was published, yet the Bill will go into Committee without our knowing what recommendations come out of that consultation. Is that not unfortunate timing? Surely subsidy is an important word in the context of the Bill.

How we deliver the bus service operators grant in future is important, and that is open to consultation. It would not have been right to delay the whole Bill until we had been through the consultation and then examine the Bill in that context; things can be done the other way round. We know that powers in the Bill will give local authorities and bus operators the ability to move forward together. If the hon. Gentleman were to examine the consultation document, he would see that it contains a few suggestions as to how the grant might be used to support the increased usage of bus services. So, it would not have been right to wait until the whole thing had been finished before considering the Bill.

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I shall give way to the hon. Lady, but then I ought to move on.

Does the Minister agree that the major bus success stories in the country have been brought about by voluntary partnerships, and not by the statutory partnerships or quality contracts proposed in the Bill?

No.

My hon. Friends said it all. If the hon. Lady thinks that the current situation is perfect, I do not understand how she can be talking to her constituents or those of other hon. and right hon. Members in her party. Voluntary partnerships have worked in some cases. In cities such as York and Cambridge, and sometimes in rural areas such as Warwickshire and Cheshire, bus services have been transformed and are consequently attracting growing numbers of passengers. Such examples show that people will return to buses if services are improved through effective partnership working between bus operators and local authorities, but for each place where partnership is making a real difference, there are many others where that is not the case and where more still needs to be done to provide the services that people want. I find it astonishing that the Conservative party does not recognise that.

I agree with the Minister, and I want to see how we can move forward from this position. I have delivered petitions to this House from my constituents because bus services have been savagely cut in my constituency by First. I am looking forward to hearing her tell us more about how local authorities can move forward on the contracts and bus partnerships, because large parts of my constituency have no bus services any more.

My hon. Friend is right, and her comments show that she is in touch with the needs of her constituents. She recognises that although voluntary partnerships can work in some areas, in others they do not and more needs to be done. We know that more needs to be done, and that is what the Bill is all about.

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I shall give way first to my hon. Friend the Member for Southampton, Test (Dr. Whitehead).

Is the Minister aware of the existence of an inter-authority organisation called the Partnership for Urban South Hampshire—PUSH—which has undertaken considerable discussion on the question of integrated transport arrangements? It would be interested in the possibility of becoming an integrated transport authority under the terms of the Bill. Is she aware that the majority of PUSH’s members are Conservative-controlled authorities? Does she share my concern that the Conservative party appears to wish to vote against the entire Bill and thus to deny those authorities the opportunity to provide the sort of integrated transport system that I believe south Hampshire urgently needs?

Again, my hon. Friend makes an important point. I know from my visits around the country that politicians from all parties say that they would like to have greater powers in order to sit down with bus operators and make progress on schemes of exactly the type that he is talking about. He will know that the Bill gives areas the ability to examine their governance arrangements and to decide whether they want to establish integrated transport authorities. He rightly says that, again, the Conservative party does not seem to be in touch even with its own local councillors on this issue, because its approach does not reflect my experience when going around the country—all I can say is that perhaps Conservative Members need to get out a little bit more.

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I shall come back to the hon. Gentleman in a minute.

The Bill is a direct response to what local authorities, transport users and, in some cases, transport operators have told us about the different challenges and circumstances faced in different parts of the country. In the summer of 2006, the Government launched a wide-ranging review of bus services across the country. In December 2006, we published our conclusions in “Putting Passengers First”, and in May 2007, we published the draft Local Transport Bill. That was followed by a period of consultation. As I said, I made a series of regional visits to listen to people’s views about how the draft Bill could help in their areas and to their suggestions about how it could be further improved.

As a result of our public consultation and scrutiny, including a report from the Transport Committee, we were able to make some very significant improvements to the Bill before it was introduced to Parliament, including the following: taking powers to set up a statutory body to represent bus passengers; ensuring that the provisions of the Transfer of Undertakings (Protection of Employment) Regulations, following representations from the trade unions, apply where staff are affected by a quality contract scheme; and giving traffic commissioners the power to require operators to invest in improvements or compensate passengers where services are not operating properly. The Bill was introduced in the other place in November, where it benefited from further changes, including measures to boost community transport and to improve the accessibility of taxi buses.

Further to the comments by the hon. Member for Chipping Barnet (Mrs. Villiers), is it not the case that the voluntary agreements that she extols exist solely on the basis of terms dictated by the bus operators and tend to be concentrated on a minority of highly profitable corridors?

There are several instances in which voluntary agreements have been reached, but my hon. Friend is right to say that we need to look further at how we can increase the effectiveness of these agreements. That is what the Bill sets out to do. I know that he has been extremely concerned about local bus services in his area, and it is important that authorities are able to work with bus operators to reach an agreement. The Bill will give such agreements statutory force and I will describe later how that will make these partnerships more effective.

May I tempt my right hon. Friend to go a little further? Is there not a case for giving excellent transport authorities such as South Yorkshire passenger transport authority the ability to introduce quality contracts, without reference to external organisations, just as the Mayor of London can do? If she will not go that far, will she at least listen to the Transport Committee, which said that there should be a time limit on how long applications for quality contracts should be considered by the approvals board and the transport tribunal to prevent inordinate delays that would not be in the interests of bus passengers?

I will address that particular point when I move on to some of the details of the Bill, but I understand the point that my hon. Friend makes.

I share the Minister’s surprise that the Conservatives have apparently decided to vote against Second Reading. She has emphasised the importance of the quality contracts and the quality partnership agreements, but if they are so important why has there been such a dismally low take-up so far? What will the Government do about that?

As I said earlier, there were powers in the Transport Act 2000 to allow the making of quality contracts and some partnership schemes. The problem with the quality contracts was that the threshold was set too high. That is the feedback that we have received. In a sense, that is why we are replacing the test of the only practical way of delivering services with the public interest test. The intention was to be able to make the quality contracts possible, in a similar way to some of the arrangements in London, but unfortunately that did not happen in several areas and that is why we are changing the situation. It was a good attempt, but we recognise that it has shortcomings.

My right hon. Friend mentioned community transport. What estimate has she made of the potential impact of the welcome changes in the Bill, and does she share my surprise that the Opposition intend to vote against the Bill? That will upset the Opposition Chief Whip, my constituency neighbour, who has applauded the fact that these provisions will, with some adaptations, enable us to bring the dial-a-bus services in Derbyshire into the concessionary fare scheme.

It is rare that my speeches are greeted with standing ovations, but when I spoke to the Community Transport Association and announced the changes that we intended to make in this Bill, there was immediate applause. I was quite taken aback, but it showed that the changes we are making to community transport—especially the ability to pay drivers and a change made in the House of Lords to allow local authorities to lease vehicles to community transport organisations—have been widely welcomed by the community transport sector. It is astonishing that the Conservatives do not recognise the importance of the change, which will have a real effect in rural areas. Why they have taken the view that they have taken is very surprising, and I suspect that it will not be very welcome to the local voluntary organisations with which they work. What repayment for the work that people do is it to vote against such a Bill? Their stance will undermine community transport provision when we are trying to improve it.

I shall now turn to the Bill in a little more detail. Part 1 includes measures to strengthen the capacity of the traffic commissioners, who play an important role in the regulation of both the goods vehicle and bus sectors. This is important because, as I will explain shortly, other parts of the Bill will strengthen the commissioners’ role in relation to bus services.

Part 2 will reform the framework for local transport planning. It will enable integrated transport authorities to play a stronger role in planning local transport across local authority areas, by making them responsible for the preparation of local transport plans. That will help to ensure a consistent and coherent approach, for example in planning a network of bus lanes across a conurbation. Future local transport plans will also need to include proposals for implementing an area’s local transport policies, and authorities will be under a new duty to have regard to the Government’s environmental policies and guidance.

Part 3 of the Bill will ensure that local authorities have a variety of realistic options for working with the bus industry to provide the services that passengers want. The Bill will give local councils the flexibility to choose the approach that is best suited to their particular local needs.

Clauses 13 to 18 will enable quality partnership schemes—first introduced in the 2000 Act—to make more of a difference. Last year, as my hon. Friend the Member for Sheffield, Hillsborough (Ms Smith) mentioned, we saw the first quality partnership scheme come into force in Sheffield. This is now delivering a package of improvements, combining new vehicles with measures to reduce the impact of congestion on bus services. Similar schemes are now being considered in other places. However, this Bill will now enable these schemes to cover frequencies, timings and maximum fares—matters that are of crucial importance to passengers. It will allow, for the first time, quality partnership schemes to include “registration restrictions”—the Conservatives say that they oppose this in their reasoned amendment—so that operators who have not signed up to the scheme cannot run along the route if their doing so would undermine the scheme. That is the point that my hon. Friend the Member for Pudsey (Mr. Truswell) made. The partnerships need strengthening so that they cannot be undermined by someone choosing to interfere in the agreement that bus operators and local authorities have reached.

Clauses 19 to 40 will make bus franchising a much more realistic option for local authorities where they believe it is the right thing to do in their area. We have listened to the concerns of local councillors of all political persuasions that the existing legislation is too restrictive, and this Bill will put that right. Of course, authorities will still need to be satisfied that quality contract schemes are in the public interest, but they will no longer have to prove that they are the “only practicable way”.

My hon. Friend the Member for Selby (Mr. Grogan) raised a point about the approvals board for quality contract schemes. Our proposals would make quality contracts a more realistic option for local authorities, while ensuring that the legitimate interests of all parties are taken into account. If we can do that, it will dramatically reduce the scope for challenge.

The proposals are in line with the recommendation of the Transport Committee that an independent approvals board should ensure that local authorities have undertaken the correct process for making a scheme. Of course, a local authority’s policy—I know that that is what my hon. Friend is getting at—is a matter for that authority and its electorate. The role of the approvals body is to provide a robust check on whether a proposed scheme is consistent with that policy, provides value for money, satisfies the criteria prescribed in legislation and is in the wider public interest, as well as whether due process has been approved.

The approvals process will provide a robust check and balance in the process but will also significantly reduce the risk of a scheme being taken through a costly and time-consuming judicial review. We agree that the process should not cause undue delay and the Bill includes a power to specify in regulations a time limit within which the approvals board should reach its decisions. We understand that the process needs to be efficient and quick. Regulations will include the ability to give an indication of that. However, if months are required to make a quality contract, we need to compare that time with the years it could take for a challenge under judicial review. This is a belt-and-braces approach for local authorities to ensure that they have that security when they make a contract scheme.

That point goes to the heart of an important issue. I listened very carefully to what my right hon. Friend just said about the processes for quality contracts, but is it not true that judicial review is essentially a challenge to a process that has not been carried out properly? That option will still be open to operators if they do not like the quality contracts and want the free-for-all that we have now. My right hon. Friend has just set out the fact that the approvals board will have the power to consider issues such as value for money and the wider public interest. Could there not be simply a difference of view between an approvals board and an elected passenger transport authority? The view of the approvals board would triumph in such circumstances, overriding the democratically elected body. Is that really acceptable?

We do not envisage that the process would involve a straight yes or no. It could be iterative. We would envisage that the approvals board would have, under the traffic commissioner, an economist and perhaps a transport expert to ensure that it could consider the economics of the scheme. Judicial review might not just be on the grounds of a process that was not followed. Other issues come into play, for example when a business can no longer operate in an area. Those are different grounds that could be used. We are trying to have a process that could be iterative at the same time—that is, that could involve discussions about maximum fares or the viability of routes. It is not an attempt to make it more difficult to get quality contracts, but to ensure that quality contracts can work and can be introduced effectively and efficiently without the huge delays caused by a judicial process.

I entirely accept that if an approvals board agrees with the passenger transport authority that quality contracts are the way forward, that could be a stronger position to defend if a judicial review eventually happened. That goes without saying, but is it not possible that the approvals board, simply as a matter of opinion, could reach a different view on the right way forward for bus passenger services in an area from the passenger transport authority? In such a situation, is it not true that under the Bill the approvals board could overrule the decision of the passenger transport authority and decide on a way forward of which the authority did not approve?

It will not be for an approvals board to design a system for a local area. The board will consider the proposals and say whether it believes—this could be done through discussion—that they will stand up and deliver what the local authority thinks they will. It is not a question of a transport expert going to an area and saying, “We will have an entirely different approach in this matter.” We expect the boards to be a facility that will enable local authorities to introduce quality contracts, if that is in the public interest, as quickly and effectively as possible. It is important that we put in place a mechanism that means that local authorities are not constantly taken to judicial review. I am sure that we shall continue to discuss this subject in Committee, but I ought to move on.

I understand the Minister’s desire to ensure that there is a robust system in place to prevent unnecessary judicial review, but we also have the hurdle of the transport tribunal. If the approvals board is the external validation process that provides that rigour and defence, why is there further recourse to the transport tribunal? Why is that provision in the Bill as a further hurdle?

If we want to be absolutely sure that the route will mean that it will be more difficult to go to judicial review, there has to be an option of appeal against the approvals board. That is why we put that provision in the Bill. It is a belt-and-braces approach. Because one could if necessary judicially review the approvals board, there is a further appeal.

Let me move on to voluntary partnership arrangements. Clause 41 and schedule 2 make some important changes to competition law as it applies to the bus market. The aim is to ensure that competition law does not prevent local authorities and bus operators from coming together at the partnership table. At the moment, if bus operators come together with local authorities under a voluntary partnership to discuss, for example, times when they might run complementary services, they risk falling foul of competition law. The Bill will mean that operators can sit down with local authorities and plan services more effectively.

Part 4 contains various further measures on passenger transport. For example, clauses 52 to 56 will help to create new opportunities for the community transport sector, which plays an important local role, often in the areas with the greatest social need. As I said, the Community Transport Association has given a warm welcome to measures in the Bill that will allow its members greater flexibility over the types of vehicles that they can use, and that allow drivers of community bus services to be paid.

Clauses 57 to 60 will help to ensure that action can be taken where, for whatever reason, bus services are consistently unreliable. Traffic commissioners will still be able to apply financial penalties when bus operators are at fault, but now in a way that directly benefits passengers, requiring the operator to invest in service improvements or to pay compensation to passengers.

The Bill will also enable the traffic commissioners to hold local authorities to account if their failure to meet their traffic management duties contributes to the poor reliability of bus services. They will be able to make recommendations to bus operators and local authorities alike about how things might be put right. We have done that to respond to the legitimate concerns of bus operators, who have sometimes said, “We’ve made improvements in local areas, but the local authority has not kept its side of the bargain.” Again, it is astonishing that the Opposition wish to vote against that.

My right hon. Friend makes a very important point that goes back to what she was saying about the new role for integrated transport authorities. Often, some local authorities in a metropolitan area are good at introducing quality bus measures, but others are appalling at it, which has a knock-on impact on the level of service. Does she agree that the changes proposed in the Bill will mean that across a whole metropolitan county there could be a proper network with proper quality bus measures? That will mean that the reliability of bus services, which she has mentioned, can better be guaranteed.

Absolutely. My hon. Friend is quite right. I should add again that when I have visited local areas and talked to people who are trying to deliver transport, councillors of all parties have said that they have sometimes come across that problem. They have said that they could do much more if the powers in the Bill were already in place. They say, “Please get these powers in place as soon as possible.” The Opposition Front-Bench team do not want them at all.

There is widespread agreement that at the same time as strengthening the traffic commissioners’ role, we need to give passengers a stronger voice about the services that they use. Talking to passengers makes it very clear what they want: buses that go where they want to go, when they want to travel, and are clean, comfortable and not overcrowded, and reliable services that get to their destinations quickly and efficiently.

We need to put passengers at the heart of our bus services, and give them the opportunity to hold those services to account. There are already well-established bodies that are helping to do just that, often operating at local or regional level. Many people have argued, however, and I agree, that there is a good case for establishing a statutory body, with statutory powers, to act as a champion of the needs of the bus passenger. We launched a full public consultation last December, and we are now carefully considering the many responses that we have received. There is a clear consensus about the need for a bigger passenger voice, and we will announce our conclusions shortly. Clauses 68 and 69 contain the primary powers that would enable us to take forward that important agenda in future secondary legislation.

Many of the transport challenges that our communities face require local areas to work closely in partnership with each other. That relates to the point made by my hon. Friend the Member for Denton and Reddish (Andrew Gwynne). Those partnerships must have the powers and authority to make the decisions that are needed. Passenger transport authorities and passenger transport executives play a crucial role in delivering public transport in our major cities outside London, but the current arrangements have been in place for several decades and do not always lead to coherent transport planning across our major urban areas. We therefore want to support those urban areas that are now starting to explore the options for reform.

Instead of taking a prescriptive approach to local transport governance, part 5 of the Bill lays the foundations for local areas themselves to examine the strengths and weaknesses of their existing arrangements. They will be able to develop their own proposals for reforms to suit their local needs, which could then be implemented in secondary legislation tailored to the needs of the individual area. That process could lead to a stronger role for integrated transport authorities, perhaps with stronger powers on important matters such as bus lanes, leading to a more coherent and consistent approach such as my hon. Friend described.

I am grateful to my right hon. Friend the Minister, who is being very generous in giving way. Under the Bill, would it be possible for an integrated passenger authority to cover a whole region, for example the north-east of England, if proper consultation took place and authorities were prepared to buy into it?

What we have said is that we want local authorities themselves to consider what will work best. We would expect wide consensus in the setting up of new bodies, and my hon. Friend will know better than I whether such consensus is likely to be reached at regional level. Of course, other transport planning measures are possible under other legislation, such as multi-area agreements. It is quite possible for local authorities to get together much more effectively than was previously the case and to plan more widely, and we are already seeing that. I am sure my hon. Friend knows that the changes that are taking place in relation to the regional development agencies and so on are causing people to look closely at how to deal with transport.

Governance reforms could obviously be particularly beneficial in areas that are considering the role that road charging could play alongside investment in local public transport. The Bill makes it absolutely clear that it is for local authorities, not central Government, to decide whether local road charging is right for their areas. It confirms that scheme revenues are for the local authority involved to spend on local transport, even after the first 10 years of a scheme. It also ensures that the right powers are available to secure consistency and interoperability between schemes, helping to avoid confusion and complexity for road users.

In 2005, the Labour party manifesto stated that, if re-elected, the Labour Government would move away from

“the current system of motoring taxation towards a national system of road-pricing.”

If road pricing schemes get the go-ahead under the Bill, which existing motoring taxes will be reduced or abolished?

The Bill is not about a national road pricing scheme. It is about local road pricing schemes, if local areas want them. Frankly, the type of changes that the right hon. Gentleman is talking about would be impractical in a local area and a local scheme, and I am sure he knows that. What we have said, however, as I have just stated, is that any revenue raised will be ploughed back into public transport even after the first 10 years of any road pricing approach.

I thank the Minister for giving way; she continues to be very generous with her time. She says that decisions about road charging schemes will be taken locally and should be in the hands of local authorities. What is her view of the current situation in Greater Manchester, with which she will be familiar? Seven of the 10 boroughs are apparently in favour of such a scheme, but the other three are most definitely not. Does she intend that the Government will continue with their policy and effectively force the scheme on the rest of the conurbation of Greater Manchester, whether it likes it or not?

Obviously, the discussions about the Manchester transport innovation fund bid are still going on, and we will examine the proposals when they come to us.

As I hope is clear, the Bill has a strong focus on empowering local communities to address the transport challenges that they face today and will face in the years ahead. It does so by ensuring that the right powers are available at the right level to deliver the changes that are needed locally, by giving a stronger voice to transport users and by ensuring that the right governance arrangements can be put in place locally so that the decisions that are needed can be made. There is a great deal of support for the Bill, not least because transport users, local government and central Government agree that we need local communities to be empowered to secure services that are designed around the needs of passengers—local transport that genuinely puts the needs of the travelling public first.

This Labour Government have vastly improved the provision of bus services in this country, after the disastrous actions of the previous Tory Government. I hoped that all parties would support the Bill today, but the Opposition have apparently decided not to do so. That shows exactly how out of touch they are with the real concerns of people in this country. It will remind us of the real attitude of the Conservative Party, which goes back to Margaret Thatcher’s view that if a man was using a bus after the age of 30, he was a failure. What nonsense. Millions of people use our bus services, and if the Opposition do not support the Bill, they will be turning their back on those people. It will be frankly astonishing not to support these changes, and I am amazed that they are even considering that. I know it will be against the will of many of their representatives in local government. Without a Labour Government there would be no national concessionary travel scheme, nor the increase in bus use that has been evident over the past 10 years. This Bill is a further step on that journey of improvement, and I commend it to the House.

I beg to move,

That this House declines to give a Second Reading to the Local Transport Bill [Lords] because it encourages the introduction of Quality Contract schemes to reregulate bus networks, thus preventing free competition between bus operators, undermining service quality for passengers and jeopardising the partnerships between operators and local authorities that have helped to improve service quality; because it fails to give due weight to the importance of consultation and local consent when local congestion charging schemes are considered; and because it transfers revenue-raising powers to the National Assembly for Wales without proper constitutional justification and in doing so allows Wales to be used as a test bed for the Government’s untried, untested national road pricing scheme.

I want to start by emphasising one thing very clearly—buses matter. Any Conservative Government led by David Cameron will do all that they can to improve bus services for passengers. Two thirds of all journeys by public transport are made by bus every year. That is well above the combined total of journeys on both the London underground and the whole national rail network. For thousands of people across the country, the bus is the only option when it comes to local public transport.

So buses matter to our quality of life and to our economic prosperity. Critically, of course, they now also matter when it comes to tackling problems caused by climate change and worsening traffic congestion. Increasing bus ridership should play a significant part in a successful strategy to tackle both those vital issues for our country, so I welcome the fact that this Bill gives us time in Parliament to debate the future of the UK’s bus network.

Given what the hon. Lady has just said, and given that her party leader is in favour of improving bus services, why are the Opposition not voting for the Bill today?

We have tabled the amendment because we do not believe that the Bill is the best way to improve local bus services. As I shall explain, not all of the Bill is controversial. We agree with some elements, but we think that significant parts of it take our bus network in the wrong direction.

I do not doubt that the hon. Lady values buses, but unfortunately her hon. Friends do not. She could fit into a London taxi the Conservative MPs present for this debate; she would not need a bus. [Interruption.] I declare my interests. The hon. Lady said that bus deregulation had worked outside London. If that is so, why has overall bus ridership outside London fallen rather than risen?

There are many differences between the London example and the rest of the country. It is clear that the level of subsidy in London has a much more significant impact on ridership than matters to do with regulation or deregulation. It is simply not possible to make a causal link between the regulatory structure in London and levels of ridership. That equation does not add up.

I listened carefully to the answer given by the hon. Lady. The Select Committee on Transport has produced a number of reports on the question of subsidies, however, and if she has read them, she will know that virtually no subsidy was given to the regulated London bus system until the city got a Mayor. Even so, the passenger figures for London remained static, while those for metropolitan areas in the rest of the country fell. Does not that make the case for regulating the bus system outside London, or would she prefer to deregulate bus services in London, since they are so good?

I assure the hon. Gentleman that we have no plans to change the system in the capital, where special circumstances apply. However, he fails to make the case for a causal connection between the regulatory system in London and the recorded increases in ridership. The subsidy in London amounts to £638 million, and that clearly makes a significant difference. The disparity between ridership in London and the rest of the country is not due to the regulatory system in place in the capital.

I want to get this right. The hon. Lady has said that there is no causal relationship between the regulatory system that operates in London and bus ridership. However, she accepts that the capital has been very successful in increasing bus ridership. If there is no causal relationship between the two, why does she rule out the possibility of changing the regulatory environment in London?

As I said, we have no plans to change the regulatory system in London.

I turn now to the Bill itself. We welcome the provisions on community transport that the Minister outlined earlier, and those aimed at preventing competition law from getting in the way of sensible arrangements to co-ordinate and improve bus services. Of course it is vital to police anti-competitive practices effectively, but it makes no sense if competition law actively frustrates arrangements that benefit passengers.

Competition law, as some people currently interpret it, can put a very real barrier in the way of efforts to improve local bus services. Even a low-key discussion between bus operators to consider co-ordination measures aimed at benefiting passengers can potentially give rise to dawn raids by competition authorities and the police. It is a matter of serious concern that this problem remains unsolved so long after deregulation.

In that regard, I want to pay tribute to the work done by the Campaign for Better Transport. The Opposition can see some appealing arguments in favour of the call that that organisation makes in its briefing on the Bill for a wider remit for the revised competition test set out in schedule 2. The campaign’s ideas on taking into account the competition provided between car and bus, and not just between bus operators, is also something that we consider well worth exploring.

The hon. Lady seemed to suggest that competition needs to be somewhat regulated in the interests of users. Will she explain why the amendment proposes free competition between bus operators?

We are saying that some competition laws get in the way of the effective provision of better services for passengers. Those laws need to be reformed to ensure that they work more efficiently and do not get in the way of the provision of better services for passengers.

We also welcome efforts to strengthen the voice of bus passengers and to establish a “bus champion”, and we recognise the valuable work already done in that respect by Bus Users UK. We note the observations made by the National Consumer Council on this aspect of the Bill, and its call for the new organisation to be a strong national advocacy body with a clear remit to improve bus travel for the consumer. The NCC is correct to emphasise the importance of founding the work of the new body on sound ongoing qualitative and quantitative research. In that regard, we can learn from the precedent set by the high-quality research produced by Passenger Focus in the rail context.

I turn now to the Bill’s more controversial provisions, and specifically to clauses 13 to 18 on statutory quality partnerships. An invention of this Government, these statutory arrangements have lagged behind voluntary partnerships in delivering service improvements. According to the passenger transport executive group, only one statutory quality partnership has been implemented since the partnerships were introduced in the Transport Act 2000, and I understand that it is to be found on the A6135—the Barnsley road—in Sheffield.

I very much hope that that scheme is successful, but the fact that it appears to be the sole example of the use of this fundamental element of the Government’s bus policy must lead us to question the effectiveness of such arrangements. I have yet to hear from the Minister exactly what can be achieved using a statutory arrangement that cannot be delivered using the voluntary arrangements that already have a proven track record in many areas of the country.

I represent part of the city of Sheffield, and I draw the hon. Lady’s attention to the fact that it proved extremely difficult to put in place the contract for the Barnsley road quality partnership scheme. Does she agree that that underlines the need for this Bill, as it will make quality partnerships easier to use in future?

No. I believe that the Barnsley road example illustrates the fact that it is voluntary partnerships that are delivering around the country. There are many examples of that, some of which I shall come to in a moment.

We believe that the move in the Bill to include fares and frequencies in quality partnerships must be accompanied by measures to ensure that transport authorities take a reasonable approach to such arrangements. There must be proper safeguards in place to ensure that it is not possible for a local authority to put provisions in its quality partnership arrangements that would be uncommercial and impractical to implement. That is why we will scrutinise with great care what is meant by an “admissible objection” as set out in clause 18, and how the reasonableness test envisaged by the Bill will work in practice. It would clearly be wrong for local authorities to be able to impose regulation via the quality partnership system without putting in place the safeguards envisaged for quality contracts.

The concept of admissible objection will be pivotal in determining whether that risk materialises and whether the quality partnership provisions will be workable, so clear guidance on the meaning of the term is needed at the earliest opportunity. I therefore appeal to the Minister to publish the guidance—the Government tend to rely on guidance—on the clause as soon as possible, preferably before the Bill goes into Committee. That would be extremely helpful in establishing the meaning of that important term.

Clauses 19 to 40 are on quality contracts, which are another centrepiece of the Government’s bus policy, but which take us in the wrong direction. It is no surprise that they have sat on the statute book as a white elephant since their introduction, unused and irrelevant to effective attempts to improve bus services for passengers. I am the first to admit that the history of the deregulated bus network has not always lacked controversy, but I believe that the private sector has, in general, made a positive contribution when it comes to quality of service for passengers. There are undoubtedly some bus operators who underperform; that happens in all markets.

Will the hon. Lady give way?

In one moment. I believe that, overall, the investment stimulus, innovation and entrepreneurial skills and expertise in product development and marketing that the bus companies have introduced have had a positive impact on services. It seems clear that private enterprise has facilitated a more rapid renewal of the bus fleet and a more efficient cost base than would ever have been possible under the old system.

I must confess that I am struggling to follow the logic of the argument. Quality contracts have often not worked because their structure has been too inflexible to meet local requirements. The point of the Bill is to free the system up a little, so that contracts can reflect local circumstances and services can be tailored to local needs. I do not know why the hon. Lady and her party do not support that as a way forward.

We are not supporting that because we do not believe that quality contracts will deliver the service improvements and increased ridership that we all want. I do not believe that those benefits will be delivered by winding back the clock to the 1980s and re-regulating the bus network. That is why we oppose moves in the Bill to make the quality contract route back towards regulation easier for local transport authorities to use.

Will the hon. Lady answer the simple question that has been asked several times by Labour Members: if she thinks that regulation in London is good and acceptable, why is it bad for my constituents, her constituents, and the vast majority of constituents represented in the House?

What I have said repeatedly is that the increase in ridership in London is not due to the regulatory system in use in London. It is due to the £638 million a year that is spent on subsidising the bus network. It is also partly due to Transport for London taking an aggressive approach to enforcing bus priority. Both those circumstances distinguish London from the rest of the country.

I thank the hon. Lady for giving way; she is very generous with her time. Do I detect a change in Opposition policy? Are the Opposition actually in favour of subsidy, given that their argument is that it has worked in London? If so, does she recant Tory Bromley council’s judgment against the Greater London council in the early 1980s, which outlawed subsidy?

There is no change in policy. Our policy on bus services in London has been consistent.

Did the hon. Lady not hear the intervention made by my hon. Friend the Member for Manchester, Blackley (Graham Stringer)? He pointed out that before there was subsidy in London, bus ridership was decreasing outside London, but stayed stable in London, and when there was subsidy, bus ridership further increased in London? Does she not agree that that proves the point? The figures show that regulation helped bus ridership in London, and those figures were given to her in an earlier intervention.

If the hon. Lady looks at the figures, she will see that the steepest fall in bus ridership occurred before deregulation, when there was an increase in car ownership across the country. The decrease in bus ridership started to level off in the years immediately after deregulation.

If I understand the hon. Lady’s argument on London and other metropolitan areas—I represent a seat in one such area, the west midlands—she is saying that the reason for the increased patronage in London is high levels of subsidy, rather than the regulatory regime. If that is her argument, is she telling the House that she would cut the subsidy in London? Or would she increase subsidies in metropolitan areas to encourage patronage?

What I am saying is that introducing the regulatory system applicable in London to the rest of the country would not deliver the service improvements that we want. In future, we would certainly look to remove quality contracts altogether as an option outside London; we think that they are neither necessary nor effective in improving bus services in the UK. The Opposition believe that successful partnerships between local transport authorities and bus companies are the best way to deliver improvements in reliability and service quality.