I should inform the House that I have selected the amendment in the name of the Leader of the Opposition.

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

A year ago we published a new integrated policy. Ours is a transport policy, not just a policy for roads, which appears to be the policy of new Conservatism after the debate last week. Our aim is to improve choice. We want people to have greater choice, rather than a greater dependence on their cars. That means providing a better, more reliable public transport alternative.

The Bill is about providing a more punctual, reliable, accountable railway system as part of an integrated transport system. [Interruption.] The right hon. Member for Wokingham (Mr. Redwood) is still making silly remarks. I should have thought that he had had enough of that this weekend.

Order. If hon. Members wish to contribute to the debate, they should seek to catch my eye before doing so.

The British Railways Board and the franchising director are already working closely together as the shadow Strategic Rail Authority. The Bill is about taking the "shadow" out of the title and putting in more powers to enhance the effort already being made on behalf of passengers in developing our national railways.

The Bill meets our manifesto commitment and the policies described in our transport White Paper. It is consistent with the excellent report and recommendations of the Select Committee on the Environment, Transport and Regional Affairs. The Committee's all-party report on the Strategic Rail Authority and regulation said:

"We support the Government's plan for a Strategic Rail Authority as a practical way of addressing the problems of the restructured railway."

The Select Committee also said:

"The proposal for a strategic body was universally welcomed by our witnesses."

Anyone reading that report will see that the proposal was universally welcomed by the range of people who will be affected by the authority's activities. Indeed, the other day, the right hon. Member for Wokingham was arguing on the "Today" programme with a representative of a rail users consultative committee, who was advocating the establishment of a Strategic Rail Authority.

The Secretary of State has just said that the Bill is in line with the recommendations of the Environment, Transport and Regional Affairs Committee. Why, then, is he using this procedure to send the Bill, which he says has been drawn up following the Select Committee's report, back to the Select Committee before it makes further progress?

Those are the new procedures that the House has developed to provide an opportunity for Select Committees to examine Bills. As the Select Committee in this case has reported on the Bill in a most comprehensive manner, I should have thought that it would welcome the opportunity of this debate and of further examination of the Bill. The new procedure treats our Select Committees very seriously.

May I point out that my Committee not only warmly welcomes the chance to examine the Bill but believes that, because it is founded on the work that we have done, in those very few areas where we shall want to raise the odd omission we can contribute something more to the discussion?

I am grateful for that statement of support. If a Bill like this is presented to a Select Committee, it involves hon. Members in serious examination of legislation—sometimes much better than the examination carried out in Standing Committees. Although I may claim from the Dispatch Box that the Bill is consistent with the Select Committee's recommendations, it will be better to listen to what the Committee has to say once it has examined the Bill in detail. That is right and proper, but I believe that the Bill is broadly in line with the Select Committee's recommendations.

More recently, the support that I claim exists from the industry was confirmed by the Director General of the Railways Forum, David Morphet, who said:

"This Bill is good news for the railways and good news for the transport industry as a whole. As well as forming the basis for a genuine strategic partnership between the Government and rail companies, it ensures Britain's railways are at last at the top of the political agenda."

I do not think that anyone could deny that.

Will the authority's strategic role in promoting the railways explicitly extend to rural areas, not only preserving small stations but reopening some of the ones that we have lost in the past 20 or 30 years?

Very much so. The authority is concerned about the network and can recommend enhancements of the railway system. It has certain funds available to do that. That is one of the reasons why we have given it a strategic role. That will be an important advance in the powers that are available to develop a far better railway system.

My question follows on from that of the hon. Member for Somerton and Frome (Mr. Heath). As the right hon. Gentleman knows, long-haul civil aviation works only where we have good feeder routes and a through-ticketing system. When it comes to renew the franchises for long-haul railway services, will the new Strategic Rail Authority take into account the extent to which those companies are able to provide the feeder services? At the moment, people in my constituency are fortunate in having a bus service from Romsey to Winchester, but that is the only one that they have. Otherwise, they have to resort to the car. Track has been laid. If we do not make full use of that existing track to provide feeder services for long-haul services, they will not work. That is why I wish such services to be a criterion when the authority comes to renew licences, which should be for longer than seven years.

Enhancement of the system is very important, as is how the franchise negotiations take place. There will be some statements about that later, but we have to keep it very much in mind that we do not have to take the traditional patterns but should look at how we may enhance the railway system itself. That is one of the purposes of the Strategic Rail Authority—to take those points on board.

The Central Rail Users Consultative Committee said—

Will the right hon. Gentleman give way?

May I give the quote? Then I will give way.

I have said that the Select Committee has endorsed the Bill and will examine it further and that the industry has welcomed it overwhelmingly. The Central Rail Users Consultative Committee has said—I quote from the deputy chairman, Stewart Francis:

"At last passengers will see the benefit of strategic rail planning, leading to focused investment to enhance the network. We have long campaigned for effective performance and the incentives and penalties in the Bill should start to deal with these concerns".

Therefore, the industry, the Select Committee and consumer representatives fully support the Bill.

Will it be possible for passenger representatives to become members of the Strategic Rail Authority? It is not clear from clause 2 whether that is so. The right hon. Gentleman nods from a sedentary position; I take that as welcome evidence that they will be able to be so represented. Will it be possible, in the spirit of choice and of competition, for the rail authority itself to bid for franchises?

On the first point, consultative bodies can be represented. I intend to have them on the board of the Strategic Rail Authority, but not the chairmen of consultative bodies. I wish to keep the independence of rail consultative bodies, but they will keep a watchful eye on the role of the Strategic Rail Authority and will have direct representation in it. That is a proper balance, keeping that independence and accountability.

With regard to whether the Strategic Rail Authority would have the power to bid for the franchises, it would not be involved in bidding for such franchises, but it has to reserve the power to do so. If there were a breakdown in negotiations, or a failure of a company, there would have to be an operator of last resort and that would be the authority. As anyone would know from examining the Bill and from debates in the House, that was the role that we gave the franchising director. As we are transferring the functions of the franchising director to the Strategic Rail Authority, the Bill does not change what was already in legislation.

My right hon. Friend has spoken of the importance of enhancing the system. Does that include the infrastructure and, in particular, stations? Has my right hon. Friend seen the condition of some of the great railway stations of this country? They are dilapidated; they are falling down; rubble is strewn across areas surrounding tracks. They were never like that in the old days of public ownership. [Interruption.] No, they were not. There has been a marked deterioration in the standard of stations throughout the United Kingdom, which any traveller will notice on the north-west line. Has my right hon. Friend anything to say about that?

The Bill is about raising standards. There has been a growing disparity between the state of our major stations, which have received massive investment and have improved considerably over the past few years, and that of stations that are used less often—and, indeed, some that are often used—and have been allowed to deteriorate. That disparity has prompted concern about investment. The Bill is about enhancement: it is about raising standards in the service, and seeing it as a national service rather than the fragmented privatised service that we inherited.

I welcome the broad thrust of the Bill, which deals with the planning of investment and with ensuring that the railways work effectively in an integrated transport network.

Under clause 10, the Strategic Rail Authority will, ultimately, be empowered to run services if no other contractor or train operating company wishes to do so. What concerns me is the relationship with Railtrack, which is seeking a large amount of public money for its network improvements: some £11 billion is included in its proposals. Does the Bill provide any opportunity for even a proportion of Railtrack to become publicly owned so that the company—which, potentially, is to receive such a vast amount of public investment—can be made accountable to the public for the money, rather than money being passed to the shareholders in the form of the considerable profits that Railtrack is currently receiving?

The money given to the rail industry is given to the train operating companies, not to Railtrack. Railtrack raises its own resources and receives no public money except through access charges, which are subsidised. As the money does not go directly to Railtrack, the question of Railtrack's accountability for public money does not arise.

An entirely different question is whether Railtrack should be accountable for network services and for the promised development of the infrastructure. One of the first things that I did when I took office was talk to the regulator, who told me that he did not have sufficient powers to force Railtrack to deliver on the promises that it had made about network services. That is why there is a new regulator, and why there are new powers for enforcement. The Bill will strengthen those powers, to ensure that Railtrack is accountable to the public for what is basically a public facility run in a privatised way.

Will the Secretary of State say something positive about the railways, instead of all these negative things? It should be borne in mind that the number of passengers has increased dramatically over the past four years, that fares have been cut in real terms, and that subsidies have been cut. If the right hon. Gentleman is in any doubt about the massive change that has taken place, let him visit Southend. We used to have a terrible railway line there, which has now been improved dramatically.

Some very negative comments have been attributed to the right hon. Gentleman. Will he now give us some of the facts about the railways? They are much better and far less subsidised, and fares have been cut in real terms.

The problem with allowing so many interventions at an early stage is that it leads to criticism of that kind. I intend, later in my speech, to give due credit for the fact that the increase in passengers did not begin on the day that the Labour Government came to office, but was under way two years before that. That is in my speech.

Will my right hon. Friend give way?

I will give way one last time, and then get on with my speech.

I thank my right hon. Friend.

My right hon. Friend has spoken of the accountability of Railtrack. Will he ensure in the Bill that Railtrack property development services are brought within the rules of accountability? Is he aware that the Luton railway interchange in my constituency—an excellent example of the linking of rail services and airports in an integrated way—is being held up because of protracted negotiations between Railtrack and its property development side? That is preventing a valuable part of the integrated transport system from opening, at the time when it is most needed.

That is yet another example of Railtrack's failure to live up to its promises and to take account of our integrated investment priorities. That is why we believe that a Strategic Rail Authority and a powerful regulator could play an important part, not only in establishing network investment but in ensuring that it is carried out.

We often hear public statements by Railtrack about the many billions of pounds that it intends to invest. The previous regulator's complaint to me was that although those promises had been made, he could not ensure that they were kept. That was a weakness, and it is a reason why we have proposed a Strategic Rail Authority that will do much more to ensure that we have a network better than the one about which my hon. Friend is complaining.

When we took office we found a fragmented railway that was all too ready to pass the buck when things went wrong.

Will the right hon. Gentleman give way?

Very well, but this must be the last intervention because I want to get on with my speech.

The Secretary of State is being generous in giving way. My point relates to the one that arose in the previous exchanges. Given his dislike of Railtrack's standards of service, will he now rule out giving Railtrack an inside track on one of the tube contracts? Will he now promise to open up that contract to proper competition? I read in a newspaper that Bechtel, rather than Railtrack, will be brought in on that contract. Is that correct?

There is nothing new in that proposal. I made that proposal for the channel tunnel rail link. If the previous Government had done the same for the Jubilee line extension, I would not be facing an extra £1 billion cost on a lousy contract that was not implemented properly. I brought Bechtel in on that contract to improve and tighten up the Jubilee line facilities and production, which it has done. I invited Bechtel to become involved in the channel tunnel rail link operation and I asked it to restore that operation following the contractor's request for an extra £1 billion as a result of the lousy contract entered into by the previous Administration.

I learned from that experience to ensure that there is a good project organiser. That is why I have made it clear that I would not leave the tube contract solely in Railtrack's hands and that I expect a project management company to be involved. I have said that from the beginning; it is nothing new. The need for a good project organiser is the lesson that I learned from the inadequacies of the previous Administration's contract negotiations. They were part of the inheritance that I was faced with when I first began to renegotiate some of those contracts.

We found that after an initial improvement in services following privatisation, there was an unacceptable deterioration two years later, which caused great concern. We found that disgruntled passengers did not know who to turn to when their trains were late, cancelled, dirty or overcrowded. We found a rail freight industry that was eager to expand but held back by red tape and underfunding. We found a lack of investment throughout the network and historical underfunding, and parts of the industry felt no sense of urgency about making up lost ground.

In the first 12 months, the franchising director and the Rail Regulator told me that their sanctions were unwieldy and lacked teeth, so they could not enforce them and make the rail companies live up to their promises. Finally, we found that the passenger's voice was neglected.

We took stock of that inheritance. We assessed the problems and the different solutions and then took decisive action. We set the franchising director new objectives, instructions and guidance to ensure high standards of punctuality, reliability and the protection of the passenger's rights. I made it clear that I expected a passenger dividend from franchise changes such as a change of control of a franchise company.

With my encouragement, the Rail Regulator negotiated a voluntary change, called condition 7, to Railtrack's licence to ensure that Railtrack meets the reasonable demands of train operators and funders such as the Office of Passenger Rail Franchising and passenger transport executives.

The new franchising director and Rail Regulator are working closely together, but I would prefer them to do so in the new, powerful framework that the Bill will provide. Last November, I made it clear to the rail industry that performance was unacceptable and that I would call its representatives to a summit the following spring to report on the commitments that they made.

The rail summit in February was a turning point. The Prime Minister and I made it clear to the industry that things had to change. To its credit, the industry has started to respond. At the summit, it committed itself to year-on-year improvements in quality, particularly punctuality, which is what passengers value most. The industry committed itself to renewing half the entire rolling stock fleet by the end of 2002, and it is recruiting 800 new drivers. Having got rid of thousands of drivers, the industry found itself to be desperately short, which caused great delays. It has now started a recruitment programme. It has also set up a hit squad to tackle the 50 worst black spots in the railway system.

The shadow Strategic Rail Authority started on 1 April, in the form of the franchising director and the British Railways Board working together under new leadership to get a grip not just on short-term performance, but on long-term planning.

The Office of Passenger Rail Franchising will, from tomorrow, operate under the title of shadow Strategic Rail Authority. The franchising director and the British Railways Board will, of course, continue to exist as separate statutory entities with their own functions and responsibilities.

The shadow Strategic Rail Authority is monitoring delivery of the summit commitments. It has also started the process of franchise renegotiation to put in place the high standards that the last Government sacrificed in their dash for cash and privatisation. The shadow Strategic Rail Authority is also developing a proper strategic plan for the railways, planning for the growth of freight as well as passenger traffic. We have revitalised the freight grants scheme, with awards totalling £60 million over the past two years—double the amount given by the previous Administration.

The new Rail Regulator has already started asking some very searching questions of Railtrack: about the robustness of the statements in the network management statement about freight; about the absence of costed options for the freight routeing strategy; and about the robustness of proposals for gauge enhancement. He has asked for answers by 13 August. Railtrack will have to demonstrate that its investment plans are up to the task of creating an expanding railway.

We have achieved a great deal within the constraints of the framework that we inherited. However, only primary legislation can remedy the fundamental flaws that I described earlier.

I turn now to the Bill's main provisions. Part I of the Bill makes provision for the Strategic Rail Authority, and clauses 1 to 4 provide for its establishment. Clause 5 sets out the primary purposes of the Strategic Rail Authority: to promote the use of the railway network for the carriage of passengers and goods; to secure the development of the railway network; and to contribute to the development of an integrated system of transport of passengers and goods.

Clauses 5, 6 and 7 impose a new duty on the Strategic Rail Authority to develop a strategy for implementing these objectives in consultation with the regulator.

Clauses 8 to 17 confer on the Strategic Rail Authority the various powers, in the form of functions, which it can use to work towards its purposes and to achieve its strategies. It must use these powers in the manner best calculated to balance various considerations as listed in clause 7, subject to directions and guidance from the Secretary of State, and any payments which it makes must achieve value for money.

When will we see the new guidelines to the authority for the issuing of new franchises? Will any provision be made for the ending of existing franchises in the near future, or for renewed, extended franchises—perhaps for a 10-year period—to encourage the operating companies to invest in the new rolling stock required? I gather that some 7,000 wagons are possibly on order, but my constituents—like many others—are fed up with being treated like cattle and want to see the new rolling stock. The investment in rolling stock ought to be a criterion in granting the new licences.

The criteria to be considered in the renegotiating of franchises have been spelt out, and it is a pity that those criteria were not put in the earlier franchise agreements—the hon. Gentleman would not then be complaining to the House. My complaint is that promises were made but were not written into contracts. One of the advantages of having a contract is that those concerned can be held to it. If the contract makes no requirement for new investment, there is a difficulty.

One of our major changes will be to consider the extension of franchises, although that does not necessarily mean that they will be in exactly the same form. However, the commitment to investment, quality and value for money for the taxpayer will be put in guidance to the Strategic Rail Authority for the negotiations, which are in their final stages. When these are completed, I will let the House know. As we said at the summit, that would be our broad approach to the renegotiation of franchises.

Many of the franchises are set at seven years and they will all be up for renewal in one rush, a few years into the new millennium. I want the franchises to be spread out, so we can negotiate them individually to secure not only what is best for the passengers and for investment in the railway system but best value for the taxpayer, who is constantly involved in one way or another.

If the hon. Gentleman waits for the guidance, he will see that it is very much in line with what he wants. It is a pity that such guidance was not issued in the first place, but the franchises were rushed through without any such requirement, and he voted for that. I am happy to say that we will do what we think is necessary to produce a good-quality railway system. That is what the Bill and the powers are about.

I assume that the Opposition will support the Bill, although I cannot be sure what line new Conservatism will take. I know what old Conservatism did. I do not know whether the hon. Member for Croydon, South (Mr. Ottaway) is new or old Conservative, but he said:

"Such a complex privatisation needs constant fine tuning."

That is certainly true. He continued:

"The previous Government would have concluded that a strategic rail authority was necessary during this Parliament."—[Official Report, 25 March 1998; Vol. 309, c. 452.]

That was old Tory; I await with interest to see whether new Conservatism is the same.

Clause 8 gives the authority the power to give grants, loans and guarantees and to enter into agreements with third parties to secure railway investment. The guarantees can be backed by the Government, and the authority may borrow within prescribed limits. The borrowing limit is £3 billion, which is the limit inherited from the British Railways Board. Before anyone rushes in to ask whether that amount is available, it should be realised that almost £1 billion of British Rail debt is to be transferred to the authority.

I shall want to consider precisely how the debt is to be managed. The previous Administration set up the changeover, and the debts and liabilities of the British Railways Board will be transferred accordingly.

I understand that the budget for the Strategic Rail Authority has not yet been determined. We will not hold the Secretary of State to the odd £10 million, but could he give us a rough idea of the figure?

The current Opraf expenditure will remain, as the body is transferring to the Strategic Rail Authority. We estimate that the extra cost for the authority will be about £5 million a year. That is why the House is to consider a money resolution.

Clause 9 gives the authority the basic power to secure or provide railway services. That preserves the capacity to run services in the public sector in the last resort, as identified in our integrated transport White Paper. Clause 10 makes it clear that if there are no bids for franchises, or if the bids received are unacceptable, or in the event of a failure, the authority will become the operator of last resort.

Many of the authority's powers, of course, will be inherited from the franchising director, the British Railways Board, the regulator and the Secretary of State. All the franchising director's functions and all the British Railways Board's property and liabilities will transfer. Transfers from the British Railways Board will include responsibility for the British Transport police.

The shadow authority has considerable powers to do much of what is being done in the Bill, although perhaps in a different way. We do not have to wait for the Bill to be enacted to get on with modernising the railways.

Will my right hon. Friend give way?

Yes, but can I make this the last time?

The right hon. Gentleman has been very generous. He has taken about 10 interventions in 15 minutes. I have them written down here.

I appreciate the co-operation that my right hon. Friend has shown to Back Benchers.

I am concerned about land in the ownership of the British Railways Board and the fact that, under the previous Administration, instructions were given to sell that land as quickly as possible. It is important to retain the land because we may need to open lines, especially in the north where we often travel east-west rather than north-south. I hope that my right hon. Friend will seriously consider requiring the Strategic Rail Authority to retain the land in case further development is required.

It will indeed, and I have given instructions to that effect. Some land contracts have already been let, but I have made it clear that land that could be used for expansion of the rail system should be retained.

The powers that the authority will inherit include those of the franchising director and the British Railways Board, and they will be sufficient for it to begin work. The authority will also acquire responsibilities for consumer protection from the regulator, and for administering freight grants. The office of the franchising director, and the British Railways Board, will be abolished.

All staff who transfer to the SRA will do so with their existing conditions of service preserved. Staff transferring are also assured that there will be full protection of pensions. Nothing in the Bill will override the statutory protection for pensioners in the Railways Act 1993, for which we fought so hard in opposition. The SRA will also assume responsibility for the continuity of the rail industry staff concessionary travel schemes.

Part II of the Bill amends the regulatory regime set up under the Railways Act 1993. Clause 17 allows the SRA to ask the Rail Regulator to direct facility owners to provide enhancements to existing station and rail facilities—a point raised by my hon. Friend the Member for Normanton (Mr. O'Brien). That power could be used to achieve greater rail capacity in the network or even to secure new network.

The 1993 Act has left the regulator acting in isolation, because the Secretary of State's power to give guidance expired in December 1996. I am pleased that the new regulator and the shadow SRA have already begun to work more closely together, and the Bill will confirm that. I have said already that the authority will need to consult the regulator on its strategies, and clause 18 provides for the regulator to facilitate the SRA's strategy. As Secretary of State, I will also have the power to give general guidance to the regulator. The measures will ensure that a coherent railway policy can be decided and then carried out consistently by the SRA and the Rail Regulator.

I am grateful to the Secretary of State for giving way, but I think that my question will help our deliberations. If the plans go ahead as described, will he say how much of the borrowing limit of £3 billion will be available in the first full year?

I have already made it clear that debts of about £1 billion will remain after the transfer. However, the right hon. Gentleman has asked a proper question, and I intend to make a statement shortly about how the debt will be managed and about the borrowing powers available to the Strategic Rail Authority.

Clause 18 also provides that the duty on the Rail Regulator to promote competition will now be balanced by a requirement that competition must be for the specific benefit of railway users. The Rail Regulator needs to balance competition against the public interest of network provision. We are not concerned solely with the promotion of competition.

The previous franchising director and Rail Regulator complained about the weakness of their powers to enforce the promises of train companies and Railtrack. The enforcement regime is tightened by the Bill. Monetary penalties, which must be of a reasonable amount, will be payable for all contraventions of licence conditions, franchise requirements and contraventions of orders made to secure compliance with a licence or franchise agreement.

The Government have agreed in principle that the Strategic Rail Authority will be able to retain income from penalties and to reinvest it in the railways. I hope that the industry and the House will welcome the fact that that income will not be returned to the Treasury. That innovative approach is a one-off exception to the normal rules for such income. We are currently developing the details of the arrangement.

It will be of interest to the House that clauses 21 and 22 amend the closure provisions, including some dealing with major closures. The Rail Regulator's functions are to be transferred to me, as Secretary of State. I, or any future Secretary of State, will be responsible for determining major closures, so I will be accountable to the House. I am sure that the House will welcome that approach.

The definition of minor closures is extended to include the track involved in a minor closure. Under clause 23, the remit of the rail users consultative committees, whose sponsorship will pass to the SRA, is widened to cover all passenger services. The committees' independence will be maintained, and I referred earlier to the welcome that the independent central users committee has given to the Bill.

Part III makes provision for the devolution of some functions to the Welsh Assembly and to the relevant Scottish Ministers. That provision delivers parts of the agreed settlement for devolution. Other elements have been handled by orders under the Scotland Act 1998. Part III also makes provision for the consequential amendment and repeal of other Acts. We will need to add to those provisions in due course.

In conclusion—

Will the Secretary of State give way?

No, I am in my final stages.

The way in which British Rail was privatised was a national disgrace. Our Bill brings public accountability back to the railway industry; it will allow the new SRA to plan for an expanding network; it will require those who own the network to meet their obligations; and it will require train operators to fulfil their franchise agreements.

The railway industry has had plenty of well-deserved criticism but there are now positive signs of a revival of Britain's railways. Passenger traffic is rising. Over the past five years, passenger kilometres have increased by approximately 20 per cent., and roughly 14 per cent. of that growth has occurred in the past two years. Around 1,000 extra services are being run each day to help meet that growth.

Rail freight is also increasing, and is up by roughly 20 per cent. in the past two years. The industry has promised that by the end of 2002 half the passenger fleet will have been renewed. Some 433 station car parks will soon have video camera surveillance. Twelve stations have been opened since May 1997, and four more are due to open this year. All that is part of the agreement that the previous Government failed to achieve with the industry. There is a new spirit of co-operation and responsibility in the industry, and a new attitude that we need to restore a national railway in the public interest.

The Bill will reinforce those trends. It will create a new guardian of the public interest—the Strategic Rail Authority. It will plug the loopholes in the last Government's rail legislation, to provide tougher enforcement and to protect the passenger.

I commend the Bill to the House.

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

"this House declines to give a Second Reading to the Railways Bill because the introduction of this Bill now, when it will inevitably fall due to lack of legislative time and will have to be reintroduced in the next Session, is not the best use of the time of this House and represents a new definition of pre-legislative scrutiny which the Government is using as a way of side-stepping its own decision-making responsibilities and covering its doubts and internal divisions about the wisdom of the measures which the Bill contains."

I am grateful to the Secretary of State for making some of my speech for me. He concluded with sterling words about the successes of the privatised railway industry. I agree that there has been welcome progress over the past five years, and it was good of him to state that we had enjoyed the advantages of the privatised industry over that period, which takes us back to before the change of Government.

Over the past four years, the number of passenger trains has increased by 14 per cent.—one extra train for every seven previously running. Passenger miles have increased by a quarter. We all want freight to transfer from road to rail wherever possible, and freight tonne miles have risen even more impressively—by 35 per cent. during the past three years. Those are impressive figures, but we are not yet satisfied. Privatisation has many more achievements to come, provided that the Government work with the industry rather than get in its way or mess it up.

My worry is that the Bill has been drawn up by Ministers who do not like the privatised industry and who are secretly trying to find ways back to nationalisation. They do not seem to understand that the beginning of a transformation in our railway industry has occurred under Governments of both parties and as a result of privatisation. The industry never worked when it was nationalised, whether under Labour and Labour-Liberal Governments in the 1970s or under Conservative Governments in the 1980s. During the 1990s, it is beginning to work, and the Labour Government must not impede the progress of a very good Conservative policy.

Before the right hon. Gentleman finishes his eulogy of the privatisation of the railway network, will he comment on the increase in the number of complaints against individual train operating companies, and on their inefficiency since privatisation began?

People think it more worth while to complain now than they did under nationalisation because there is a proper complaints system and it is more likely that something will happen. As a train user myself, I know that services in my area have improved, but also that they are not yet good enough. I want further progress to be made as a result of more investment and more enlightened attitudes. Services are a great deal better than they were 10 years ago, although considerable room remains for improvement. As the Secretary of State has often pointed out, performance around the country is patchy. We would welcome anything that could sensibly be done to raise the performance of many operators to the performance of the best.

The right hon. Gentleman should be wary of saying that services are a great deal better than they were 10 years ago. The passenger figures to which he referred followed a dramatic drop during the recession engineered by the previous Conservative Government. The numbers have risen merely back to where they were before that recession.

My point was well made from my own observation of standards of service in my local area. It can be borne out by many of my constituents, who recognise that there have been improvements in punctuality and reliability, but that there could be even more.

Does the right hon. Gentleman accept that the sale of Railtrack for £1.9 billion—it is currently valued at more than £8 billion—is a clear example of how the British taxpayer was ripped off by privatisation? Does he further accept that giving away Railfreight for £240 million of taxpayers' money, just so that people would take it off our hands, is a complete disgrace? Any idiot could have predicted the increase in freight transportation under Governments of either political persuasion. This Government have advocated constraining the growth of road traffic, and everyone wants to see more rail freight and greater profitability in that industry.

I remember how the then Labour Opposition succeeded in doing everything that they could to undermine the rail privatisation and sale. Labour did everything it could to damage the sale price and to lower the proceeds. We warned at the time that Labour was doing damage, and that is what occurred. The shareholders of that company are now benefiting from its success. It has picked itself up after that unwarranted criticism—and in the face of unwarranted criticism from the Secretary of State on bad Tuesdays—and has developed a much better business.

Will my right hon. Friend assure the House that, if the Government produce privatisation plans—they tell us occasionally that they will do so, as is the case with air traffic control—he will not call from the Opposition Front Bench for renationalisation? Will my right hon. Friend enable the Government to secure the true market value of the industry concerned—unlike Labour did to us?

My hon. Friend can rest assured that I am unlikely to call from this Bench for renationalisation. He will also be well aware that I am always in favour of taxpayers getting a good deal. Conservative Members will do everything in their power to encourage a fair—even a good—valuation of any assets that the Government wish to sell.

I recall that a previous Administration nationalised Rolls-Royce—but I shall leave that aside. Does the right hon. Gentleman remember that when the then Opposition attacked the then Government's privatisation programme for British Telecom—there was concern about the share price—the Government did what we advocated with regard to Railtrack: they waited until after the general election and then brought forward the proposal so that the taxpayer did not lose out in terms of the share price? The previous Government could have done that with Railtrack, but refused—presumably because they thought that they would lose the election.

We thought that we needed to get on with it because the railway industry deserved privatisation. We have seen that the results of the privatised industry are much better than those achieved under the nationalised regime.

Does my right hon. Friend agree that the hon. Member for Croydon, Central (Mr. Davies) has a brass neck to level the charge that he has just made? The twenty-fourth report of the Public Accounts Committee on the flotation of Railtrack, which was published on 13 July 1999, underlines precisely the point that my right hon. Friend has made—namely, that political opposition to the flotation undermined investor confidence and the share price. Does my right hon. Friend think that the hon. Gentleman should do his homework before contributing to the Second Reading debate?

My hon. Friend is right, but I must now make some progress.

The Secretary of State began by saying that "A Fair Deal for Motorists"—a popular policy that we launched last week—represents the sum total of our policies in this area. He should know from our debate last week that our fair deal is popular, but it is only part of our transport policy. We also have exciting policies to promote more rail, tube and bus travel to ensure that people get out of their cars and on to the buses and trains. The Government still do not seem to understand that most people do not live by a bus stop or a train station. We need to make it easier for motorists to get to the bus stop or the train station and be able to park when they get there. That is a truly integrated transport policy—rather than the disintegrating policy over which the Secretary of State is presiding.

Is my right hon. Friend aware that the Public Accounts Committee report, to which my hon. Friend the Member for Buckingham (Mr. Bercow) referred, revealed that an unprecedented four pages of Labour's policy document spelling out what it would do with the railways should it be elected depressed the price of the sale by well over £100 million? Therefore, the Secretary of State cost the flotation of Railtrack more than £100 million.

My hon. Friend has admirably strengthened my point.

Is the right hon. Gentleman aware of one of the key findings of the PAC report? It states that:

"The timing of the sale was a factor in the poor value achieved, and the Department themselves acknowledge that the large increase in Railtrack's share price since flotation was because it had been undervalued and sold in haste"

Does that not completely undermine the case that the right hon. Gentleman is making?

It reinforces my case. The main reason for any undermining was because Labour made matters as difficult as possible by putting the accent on all the negatives and on none of the positives—as they were so good at doing in respect of privatisation policies and much else.

The Secretary of State said that the other day I was on the radio arguing with a train operating company representative over railway policy. He clearly did not listen to the broadcast. As I made clear on that programme, my argument is with the Secretary of State himself: it is his policy that has miscarried; it is his inability to persuade the Treasury to give him the money that he needs in order to do up public transport facilities; it is his transport policy that is falling to bits—clobbering the motorist but not providing a better alternative. I hope that the right hon. Gentleman will listen a little more carefully the next time that I am on the radio.

I am grateful to the right hon. Gentleman for giving way. As John Humphrys pointed out, we were talking about the Strategic Rail Authority—we can listen to the tape if the right hon. Gentleman cares to do so. The train operating company's representative made it clear that the operating companies fully supported the authority. That was his point. It was also John Humphrys' point—even though the right hon. Member for Wokingham wanted to talk about anything but the SRA.

My worry about the way in which the Government have presented the Bill to the public and to the House is that, until today, they have concentrated on only two clauses—those that relate to the power to fine companies that do not perform—and have ignored the wide-ranging powers contained in the other 32 clauses. Those powers will greatly strengthen the hand both of the Secretary of State and of his creature, the new quango. I have repeatedly made the point that that is a dishonest spin on a massive piece of legislation; it is a backdoor nationalisation measure, which would give the Secretary of State extremely wide-ranging powers to play at trains exactly as he sees fit.

Today, the Secretary of State comes to the House unable to answer the most fundamental and obvious question: how much of the £3 billion in the borrowing limits outlined in the measure will be available as new money to spend on buying shares, making investments in railways, running train services and setting up new tramways? The Bill will give massive powers to a new quango and to the Secretary of State so that they can play at trains and tramways and provide all kinds of public transport facilities, but we do not know to within £1 billion or £100 million how much money the right hon. Gentleman will have to play with. How on earth can we treat the matter seriously?

The previous Administration gave exactly the same powers and resources to the British Railways Board—they already exist, and will be transferred to the Strategic Rail Authority. In respect of financing facilities, we have made it clear that it is not our intention to renationalise the railways. We made that judgment before we came into office. We want to make the system work. It is not necessary to have the borrowing powers to which the right hon. Gentleman refers. I said that I would report back on reconstruction because, as we know from the experience of the British Railways Board, whenever the debts were reconstructed, there had to be a report to Parliament.

I take that to be some kind of reassurance that the provisions will be used only for existing debts and not for new debts. However, that is not how the Bill reads. The Bill gives extremely wide-ranging and open powers; it leaves open the large amount of money—well in excess of what is needed—to handle the existing debts. The Secretary of State himself told us that about £1 billion of inherited debt had to be dealt with under the measure. We are entitled to ask why he needs a £3 billion borrowing limit for the body, when he thinks that the problem is about only one third of that amount. That is most suspicious.

Is my right hon. Friend aware of paragraph 73 of the Government's response to the PAC report? On the question of whether they would be interested in renationalisation, it states

"we have made clear that renationalisation would be … expensive, and cannot be a priority."

Am I right in presuming that, if it is not a priority, it may be somewhere further down their agenda?

My hon. Friend has drawn out an interesting point—it is an interesting exchange. If the Bill is passed unamended, it will give the Secretary of State all or most of the powers that he would need to renationalise portions of the railway, and to set up a new nationalised railway or tramway system—or both—in parallel with the existing privatised industry. The measure offers no guarantees as to fare competition. There is nothing about fare levels and the rate of return that would have to be earned in order to secure fair competition. Some people in the industry are extremely worried by these wide-ranging powers. This whole piece of legislation has been dogged by controversy and trouble.

Is not the right hon. Gentleman's argument that the Bill needs careful scrutiny rather odd given the reasoned amendment, which complains about the scrutiny process?

I was just coming to our reasoned amendment. We believe that today's debate shows that the Secretary of State has failed to carry his colleagues. The Bill was cancelled last year and delayed this year and it might—if the right hon. Gentleman is lucky and we are unlucky—arrive late in the next parliamentary year. Today's debate is therefore a misuse of the House's time. We would be happy to have Second Reading and go straight into a Standing Committee in which the Bill could be given the detailed scrutiny it needs. If the Secretary of State is willing to proceed in that way, my right hon. and hon. Friends and I are more than willing to sit on such a Committee, starting as soon as possible, to give the Bill the necessary scrutiny. However, the right hon. Gentleman is no position to deliver. He has obviously been vetoed by the Prime Minister and other members of the Government, so the Bill has been shunted off into a siding and cannot make proper progress.

As the Chairman of that particular siding, may I ask the right hon. Gentleman one simple question? Are we to take it that he does not approve of Select Committees performing a pre-legislative function, or is it simply that he objects to my Committee performing that function?

I have no objection to the Committee considering the Bill, and may it take a good long time: there is much in the Bill that is disturbing, and I am not the one trying to rush through those provisions. However, let us look at matters from the perspective of the Secretary of State, who tells us that the Bill is crucial to his strategy and that he cannot have an integrated transport policy without it. If that is so, why are we having a Second Reading debate now, but no Standing Committee to follow? Why cannot the right hon. Gentleman get the Bill through more quickly?

Why is the Bill being offered to the Select Committee? If the scrutiny that the Select Committee is to give it is truly pre-legislative, why have Second Reading? Why not have proper pre-legislative consideration in the Select Committee, whose members are wise and whose scrutiny would be useful? Then, the Government could amend the Bill and return to the House with a proper Bill that had been properly considered, on which we could then have a Second Reading debate. That would be far more welcome to us than the bodged approach that is being taken today.

The Secretary of State never addressed one of the points raised in our reasoned amendment. Why is the Bill being treated differently from all the others, which have been referred to Select Committees before Second Reading? Is it not the case that the process being used is a panic measure, initiated by Downing street to cover up the botch job that the Secretary of State has made of transport policy?

That is the only possible explanation. There has obviously been a compromise: the Secretary of State said that he must have his Bill, but the Prime Minister said that he could not have it, so they hit upon the ridiculous compromise—a camel instead of a horse, with everyone getting the hump—of the Bill being given Second Reading and then going off to the Select Committee, rather than through a proper Standing Committee.

I have made it clear on several occasions that the real problem with the legislative timetable is what happens in the other place, not what happens here. The other place is starting its recess later and returning earlier than this House. We can argue about who is responsible, but the fact is that legislation has to pass through both Houses. Under the new procedures arising from the modernisation process, Bills have been sent to Select Committees and Special Standing Committees for different forms of examination. The process adopted for the Railways Bill is simply another new way of proceeding.

It will be useful to hon. Members and to people outside to know the House's opinion on the powers contained in the Bill. I hope that the House and the Select Committee will give the Bill an overwhelming endorsement. The right hon. Gentleman has not yet said whether or not he supports the Bill, and it would be useful to know that. If the House expresses its support in a vote today, it will be clear that the current actions of the shadow Strategic Rail Authority are consistent with the will of the House.

In that spirit, I shall press on to address the Bill itself, even though my right hon. and hon. Friends and I still think that we are following an odd procedure—one that tells us more about the divisions in the Government than about the need for proper scrutiny—or the need for a Railways Bill, which the Secretary of State has urged on his colleagues for many months.

The Opposition are worried that the powers in the Bill are too wide ranging and lack specific drafting through which they can be controlled. I draw the House's attention to several of the important clauses. The purposes of the authority have already been read out to the House by the Secretary of State. They are extremely wide ranging and should be read in conjunction with the powers to borrow, direct, invest and spend money. The authority is allowed to promote the use of the railway network, to secure development of it and to contribute to the development of an integrated system of transport.

Will the right hon. Gentleman give way?

I will not give way to someone who has not been present throughout the debate. The hon. Gentleman should listen a little more before intervening. I have given way to everyone else.

The wide-ranging purposes are backed up by the most enormous powers, which would leave the Secretary of State and his creature—the quango—free to run a railway within a railway and to buy up chunks of the existing network. Under clause 6(3), the Secretary of State is the person pulling the strings. The quango may be apparently independent, powerful, expensive and all such wonderful things—many millions of pounds will be spent on it—but the Secretary of State can be in charge if he so wishes. He can give the authority directions and guidance over all its strategies, stipulating what should be covered by them,

"the issues to be taken into account … the strategy to be adopted in relation to any matter",

and how to update such strategies. That is extremely comprehensive. The Secretary of State wants to buy a train set to play with, and this Bill gives him the crucial powers.

May we have clarity? Does the right hon. Gentleman agree that there should be a Strategic Rail Authority—yes or no—particularly given the words of the hon. Member for Croydon, South (Mr. Ottaway), who thought that there should be one? If there is a Strategic Rail Authority, should it have any budgetary powers? If so, which powers and how will it be accountable to Parliament? The right hon. Gentleman is very unclear.

I shall be crystal clear, as I have been on the powers and the conduct of these proceedings. The Opposition believe that there is a role for sensible regulation of the railway and support good regulation of it for as long as there continues to be monopoly elements and the power to use fares as surrogate taxation. It is most important to have a regulatory power. We do not support the creation of this regulator with these massive powers because the Secretary of State is trying to create not just a regulator but an actor, an investor and a business as well. In my experience, when the role of a regulator is muddled with that of someone providing services or interfering with service provision, one gets into difficulties, which can damage the taxpayer and the passenger or customer.

Does the right hon. Gentleman accept that it was a great mistake not to regulate the rolling stock companies when the railways were privatised? One witness told the Select Committee that ROSCOs were receiving a guaranteed income stream and profit under contracts that did not require them to invest, which led to their sale at double the price that the public got for them and their making a third of their capital value in profit? Does he accept that that was a huge mistake of the Conservatives' privatisation?

I am not sure how that problem is covered by the Bill. Perhaps the Committee disagrees with the Government in that area. We have already discussed at some length the history of privatisation, to which the Labour party, with its clumsy intervention, did much damage.

Clause 8 sets out the functions. It states that the authority may

"make grants, make loans, or give guarantees, for any purpose relating to any railway or railway services."

"Railways" for these purposes include tramways, and in certain conditions, bus and taxi services too. So this body will be enormously powerful and wide ranging. The grant, loan or guarantee may be subject to any conditions as the authority considers appropriate:

"The Authority may enter into agreements for the purpose of securing the provision, improvement or development of any railway services or railway assets."

The powers are even stronger in clause 9, which states that the authority may provide

"services for the carriage by railway of passengers and goods as the Authority considers desirable."

In other words, the Bill creates not just a regulator but a body that can take public money, with the Secretary of State's consent, and run passenger and goods railway services. Clause 9 states that the authority may include in that the provision and operation of

"network services, station services and light maintenance services, entering into agreements … for … carriage … acquiring the whole or any part of an undertaking, and storing goods and consigning them from any place to which they have been carried by rail."

That is the kernel of our case—the power is a very wide-ranging one, allowing the backdoor—or frontdoor—renationalisation of the railways, should the Secretary of State be so inclined, and should he be able to persuade the Prime Minister and the Treasury of the need to do so.

On the combined provisions of clauses 8 and 9, but especially the provisions of clause 8, surely the Strategic Rail Authority will not really have the expertise to second-guess the investment decisions of both Railtrack and the train operators. Essentially, the consequence of the provisions would be that those who make the investment decisions will not be able to raise necessary capital, as there would be no certainty that the Strategic Rail Authority will not change all the terms.

I certainly agree with that statement in the light of the fact that the Secretary of State would be pulling the strings and providing the advice.

No.

Perhaps the right hon. Gentleman would like to explain.

We propose transferring already existing powers. The regulator is already able to require Railtrack to invest in the public interest, as that was a condition of the licence. If the regulator is not satisfied that Railtrack is meeting its requirements, he is able to enforce those requirements. Therefore, under powers created by the previous Administration, the regulator is able to act by asking for further investment. The powers are already there.

The right hon. Gentleman should say what new extra enforcement powers he thinks could be created for the regulator. The complaint about both the previous and the current regulator is that, although powers were available to them, they did not use them. However, this one intends to use them.

The proposed power is a very new one, and it is much wider and stronger. It is one thing to say that a regulator is able to instruct a private sector company to make a bigger investment because it is in the regulated sector, but it is quite another to give a power to an authority to do anything that it considers desirable for the purposes of the provision of railway services. The proposed power is extremely wide ranging—

No.

I hope that the Secretary of State will look again at the drafting, because that is not how it reads in the Bill. He may now be claiming that his intentions are rather more modest than they seem to be in the Bill. I therefore hope that he will re-examine that point.

In Committee, the burden of the Opposition's argument will be that we wish to narrow the regulator's powers to that range of limited powers that the Secretary of State says that he wants and are necessary, so that the regulator—the authority—falls short of playing trains on a huge scale—which I still believe it would be entitled to do under the provisions of this very wide-ranging legislation.

If the Secretary of State would like to look at clause 16, he would see how the powers are emphasised and underlined still further. The clause states that

"The Authority may do anything which it considers—

(a) is necessary or appropriate for or for facilitating … its functions. In particular, the Authority may

(a) enter into agreements,

(b) acquire or dispose of property,

(c) invest money,

(d) form bodies corporate or acquire or dispose of interests in bodies corporate, and

(e) promote or assist in the promotion of publicity."

That gives the authority the power to run railways, to buy assets, to build stations, to own track, to own rolling stock and to run services. I do not see how the Secretary of State can deny that.

Most sinister of all—but then it is the little bit of new Labour creeping in—is the power to spend public money, collected by the authority and borrowed by the Government, on spinning at the taxpayer's expense.

I am grateful to the right hon. Gentleman for giving way; he is generous with his time. However, is he really arguing that, if a private company were not prepared to continue the franchise or were offering a very bad deal, that the public sector should not, in the taxpayer's interest, have the right to maintain and run that service? The previous Administration accepted that argument. In their legislation, they gave the British Railways Board the right—which the Bill will be transferring—to intervene to secure such services. Such an intervention would be made by the public sector when the private sector failed to produce promised services.

We have now, at last, teased out of the Secretary of State the power's importance. In Committee—if the Bill reaches that stage—we shall be pressing hard to try to limit the power rather more than he has done.

Currently, the power is far too wide ranging, and the Bill does not make it clear that it will be used only in extremis, after something has gone horribly wrong—something far worse than has yet happened in the privatised industry. I think that it is very unlikely that something will go wrong on that scale. if the Secretary of State saw fit, the power could be used in totally different conditions—and it is to that that I and my right hon. and hon. Friends shall be objecting. I hope that the Secretary of State now has a clear understanding of the Opposition's view of the Bill. We believe that it needs a fundamental rewrite. We are all in favour of sensible regulation, but we think that the Bill goes far too wide.

I am still not absolutely clear about the official Opposition's position. Do they wish to keep the present regulatory structure as set up at the time of privatisation, or do they accept that that has proved inadequate and that there needs to be a strengthened regulatory structure, albeit not the one presented today?

We would be happy to examine a sensible revision of the structure. It is always possible to improve things in the light of experience. However, I do not think that the Bill presents the right approach. It is clear that it goes considerably further than the Railways Act 1993, for example. The powers of that Act are expressly amended by provisions set out in the Bill. It is proposed to make things tougher and to give the regulator more wide-ranging powers to intervene and to interfere in the running of the railways.

We are suspicious of the costing of £5 million per annum for the authority. That may prove to be an underestimate given the enormous range of strategies and functions that the authority will have foisted upon it. We wish to return to the question of £3 billion. It is most important to know how much of that money will be available to do the sometimes worthy things that are demarked in the Bill.

We are worried about the length of franchises and we believe that decisions are pending. These decisions have been delayed for many months and this is becoming an impediment to proper investment and success in the railway industry. I have heard complaints from those in the industry that decisions have been sitting in the Secretary of State's "in" tray for many months. That is a great pity. I thought that there was cross-party support for the idea that the privatised industry should be given its head to make the necessary investments. We are all impatient to see new rolling stock and better services.

The Opposition urge the House to adopt our reasoned amendment to the procedure for the handling of the Bill. An enormous mess and muddle has been revealed at the top of Government, a huge row between the Prime Minister and his deputy and obvious second thoughts around the ministerial table about the wide-ranging powers that are being offered through the Bill to the Secretary of State and to the quango creature that is being established beneath him. If this were the world of "Thomas the Tank Engine", this would be the Bill to make the Fat Controller wax lyrical at night at the great strengthening of his powers.

We shall be offering strong scrutiny of the Bill. It is not the right Bill at the right time. The Secretary of State should concentrate on better tube investment, better car parks at stations and easing the flow of cars to stations. We could then have an integrated transport policy. We see chaos and disintegration surrounding the Secretary of State. There is a lack of ability to win the investment that he needs for public enterprises from the Treasury and a willingness to get in the way of sensible investment by the private sector. The Bill will not help and that is why we are opposing it tonight.

The Strategic Rail Authority is the first intelligent attempt to bring together a proper planning system for the future of a new and modern railway system, and is a long overdue recognition of the fact that the privatisation and fragmentation of the railway system unfortunately resulted in the passenger receiving a far from acceptable level of service.

In its report on the Strategic Rail Authority, the Transport Sub-Committee made it clear that there were considerable problems if a modern railway was to be worked in the disorganised and disorientated manner that had ensued with privatisation. It made it clear also that we would not be able to remedy the situation without some reintegration of the various companies and an acceptance of the fact that some of the powers handed to both the franchising director and the Rail Regulator were not sufficient to cope with the lacunae that had appeared in both the administration and operation of the railways.

Today's debate is not only extremely welcome, but long overdue. My Committee warmly welcomes the opportunity to examine the Bill in considerable detail. We believe that it contains many aspects of policy that we have already examined in such detail, but inevitably there will be areas where the Committee will want not only to make suggestions but to consider the wording.

Given the way in which, in recent years, some legislation that has been put before the House has not been in its final form, it is tremendously important to use such a Committee to consider the detail, as a pre-legislative Committee can do. Far from the Select Committee delaying the passage of this legislation, it can, if need be, produce a polished Bill and perhaps even a better formulation—if my right hon. Friend the Secretary of State will forgive me for saying so.

Am I right in thinking that the hon. Lady's Select Committee, on which I serve, reserves the right to make possibly trenchant and fundamental changes in the Bill, or will it merely be a rubber-stamping operation?

I do not know to which Select Committee the hon. Gentleman is referring. If he seriously thinks that any Committee that I chair would be known as a rubber-stamp Committee, I can only assume that his frequent absences from the Committee have been such that he has forgotten what goes on.

My right hon. Friend the Secretary of State will have noticed that the business motion on the Order Paper suggests a date by which the Select Committee's examination of the legislation will conclude. That is helpful. By next Session, the legislation will have been considered and extra evidence will have been taken. Points that need to be made by the operating companies or various other elements, including passengers, will be not only welcomed but registered in a way that ought to be constructive and useful.

The Bill contains tremendously important provisions. Railtrack will now have to comply with investment requirements not simply by producing a number of wish lists, but by demonstrating that it is serious about its investment programme. I do not want to digress by discussing some of the more interesting recent developments, but I would mention the network statement, for which Railtrack got the support of consultants who said that they had not checked any of Railtrack's figures but could nevertheless project them into the future to produce particular results. That is not the sort of expertise or, frankly, detailed work that my Committee finds acceptable.

Clearly, Railtrack must not merely talk about what it intends to do but demonstrate that it means to do it. It must produce concrete plans that are not just based on extra money from the taxpayer. If Railtrack is to fulfil its responsible role, it has to get on with a programme to deal with its very old infrastructure. Railtrack has known for a long time about the problems of pinch points, for example, and of some track that needs considerable maintenance and improvement. It knows of the need for reinvestment in lines such as the west coast main line. The sooner it makes those changes rather than talking about them, the better the passenger will be served.

I know my hon. Friend's constituency well. As she is aware, I spent some time as a railway engineer maintaining bridges in and around Crewe. Will she tell the House whether Railtrack has delivered on its promises and commitments on bridges in the relatively small area in and around her constituency; and will she tell us how detrimental its failure to produce has been to the immediate economy of her constituency?

I do not want to get diverted, but people who enter my constituency have to cross antique rail bridges; indeed, three of the main roads are on rail bridges. The previous time one of them was examined and modernised, it managed to sink 11 inches during one night, so I am somewhat sensitive to the difficulty arising from trying to rebuild an ancient system. Not only will working on bridges be an urgent part of Railtrack's work, but it will have to work closely with others to provide a properly programmed advance in the provision of proper infrastructure.

Will the hon. Lady at least admit that investment expenditure under Railtrack is more than double what it was under British Rail? If British Rail had not been privatised, where would her Government be getting that money from, given that public investment in transport, for which the Deputy Prime Minister is responsible, is being cut?

I am getting pretty bored with these absurd interventions from Conservative Members. The whole of the west coast main line would be modernised today and there would not be such poor standards if the money that was spent on privatisation—including that which was identified by the Public Accounts Committee as going directly to people whose only contribution was making the most absurd suggestions about how particular contracts should be framed—had gone into the railway system. Rail companies certainly would not be adding 10 to 15 minutes to every timetable in the pretence that services are getting somewhere near their original arrival times. I am bored with all that and the time for going over and over such absurd suggestions is gone.

The Strategic Rail Authority will be able to retain fines, rather than pass them back to the Treasury, and spend them on the infrastructure. That is not only a sensible development, but one that will soon be seen to be advantageous. I believe that the acceptance of a public sector benchmark, which will provide for the assessment of all franchise bids, is not only long overdue, but will mean that the passenger will be much better served in future. The Strategic Rail Authority will have responsibility for publicising rail services—not, if I may say so, for providing beautiful posters at conferences saying what a wonderful investment programme there will be in the next 30 years. It will tell rail travellers, "In future, you will be able to travel safely, cleanly and punctually." At present, all those "minor" points are not taken seriously by many of the companies.

I believe that open access and the changes proposed in the Bill will make a difference. Companies will not only have to face up to the real problems of competition, but seriously consider what to do in order to attract more passengers. Some aspects of the Bill, such as the permission to promote light rail, will transform a lot of other railway services. People want clean and comfortable access to various forms of rail transport and they believe that an integrated system means getting on a train at their chosen station, comfortably and safely, and getting off where they want to be—not a considerable distance from their ultimate destination.

When my hon. Friend's Committee examines the Bill and other developments in railways legislation, will she look enthusiastically at the possibility of reopening a large number of mothballed, underused or unused lines so that we can develop properly integrated local transport systems? We should bear it in mind that some lines would be loss makers initially, but over time integration would encourage people off the roads and on to the rail system, which they are not attracted to at present because they live too far from the main lines.

I hope that the Strategic Rail Authority's powers to borrow will enable it to look forward to means of developing the network; it should not simply rest on the present system. Although my hon. Friend specifically mentions services that may have been mothballed, there are all sorts of other developments. For example, many of us look forward to a real increase in freight once lines are available. If there were a new freight line through the centre of England, we would begin to see a serious movement of large amounts of freight off the roads and on to the railways, where it belongs. That would not only promote a better environmental response in many areas but would demonstrate efficiency and represent something that people genuinely want. Part of the SRA' s powers will be to consider such schemes and the occasions on which investment should be made in them, and to encourage others to take up new and more imaginative schemes.

Will the hon. Lady give way?

Yes—for the hon. Gentleman, I shall of course give way.

The hon. Lady is most gracious. If she is right in suggesting that investment will be considered for light railways and the reopening of disused lines, might not we have to consider a considerably higher budget than the £5 billion that the Deputy Prime Minister mentioned in answer to my earlier question? The central railway line alone would take £5 billion, plus some change.

As the hon. Gentleman knows, many people would be interested in such a development and might be prepared to talk seriously to the SRA about how it could be financed.

Will my hon. Friend give way?

I am trying to make a shortish speech, but I am getting so much help.

Is my hon. Friend aware that, in Croydon, the Tramlink project that is due to be completed at the end of this year involves both private money—to the tune of £75 million—and public money? Moreover, it uses a disused railway line to create a new commuter link, which is proving popular. We have the finance, and I hope that my hon. Friend will come to Croydon at the end of the year when we open the line.

My hon. Friend tempts me into all sorts of interesting debates about how passenger transport authorities' and local authorities' transport plans can be fed into the plans for a shiny new railway system. That is what I look forward to in the next millennium, but I do not wish to speak for too long today.

My right hon. Friend the Secretary of State would not expect me simply to tell him that the Bill is absolutely marvellous, because it has left out some of the bits that I think are important, and I shall want to ask him a number of questions in the future. I hope that the SRA will have the power to prevent another round of rural closures. Many of us who have lost railway stations know that that directly contributes to a drop in the number of passengers in some areas. Some of the stations that are now being warmly welcomed by the Opposition were paid for by local authorities, which got absolutely no credit and were then told by Railtrack that they would have to pay towards the maintenance.

rose—

Oh—I am most honoured to give way to my right hon. Friend.

Perhaps I can satisfy my hon. Friend by saying that, when the closure of a line is requested, the decision will no longer be dealt with by the regulator but will come directly to me as Secretary of State. It will be a decision for which I shall be answerable to this House.

I welcome that tremendously important development; passengers will want not only to see it carried through, but to have an input into any decisions that are taken.

I hope that the public borrowing figure for the SRA, which seems pretty generous to us, will be fairly secure and that the whole question of whether the SRA can borrow on the open market will be discussed. If the SRA is to create public sector comparators for franchise bids, that will be helpful, but if for any reason the franchises collapse—I am afraid that, if we are not careful, privatisation will create a two-tier railway system in which some companies can run well but others will come perilously close to being non-viable—the SRA may need to assess accurately exactly what should happen to their bids. It will therefore need a base so that it can consider whether it can run those services as the owner of last resort.

I take the point that my right hon. Friend made earlier in the debate about the absurdity of the Opposition objecting to the transfer of powers that were in the hands of the British Railways Board before the introduction of this Bill. One aspect, however, has not been transferred. I am a bit anxious about it. My Committee made it clear that it thought that BRB should not sell rail land before decisions that could have an impact on the railway system. The Secretary of State knows better than anyone that, in the previous century, railway companies were extravagant in their acquisition of land. It would be extraordinary if we were trying to plan for a new system but, because of a hangover from previous legislation, the BRB was selling sites. There will always be some bits of land that it is happy to let go, but it is important that strategic decisions be taken in relation to particular land before it is put on the open market.

I know that the Select Committee will want to examine the difference in the powers between Wales and Scotland. It will also want to examine the role of the London mayor and whether, in the Bill, the mayor's powers should appear transparent to the voters.

I was glad that the Secretary of State mentioned that he wanted passenger representatives to be on the Strategic Rail Authority. It is extraordinary that we all talk about the internal debates between the operating companies, Railtrack and Ministers, but that, even with the only slightly improved passenger rail authority set-up, we still do not hear the voice of the passenger as strongly or as usefully as we should. It is vital that passengers, freight users and railway employees should have a direct input, so that their views are heard. I am not suggesting that they should automatically be given precedence over other aspects of rail policy, but unless their voice is heard there will be a real worry. One hopes that the new consumer structures will be broader than existing ones.

I hope that, somewhere in the legislation, we can look at the whole question of rail safety. Despite its age, the railway system is very safe. People are carried safely, but there are still problems about some of the slam-door stock and the speed at which it is being replaced. There are worries, too, about the signalling system and about its age.

Without being unkind about it, if Railtrack feels that it is necessary to issue a notice to its contractors saying, "Please do not touch the signalling because the wiring is so old it may automatically go wrong," we have to worry about some aspects of the working of the system. We need to look at them closely.

Will the Strategic Rail Authority have the right to say to companies, "We do not want you to carry on with some of the rolling stock—certainly, mark one rolling stock—and we want it to be replaced as quickly as possible"? The Government so far do not seem to have told us exactly how many train operating companies they believe should be in existence. It is possible that, at the end of the franchise renegotiation, there will be no need for quite so many companies. It would be helpful to know exactly what my right hon. Friend has in mind for the future.

I am concerned about the tension between competition policy and the integration of a railway system. We know that, once there is privatisation, there is a need for regulation. Those two things are likely to grate against one another. The arguments advanced by individual operators are the sort of arguments that have been used by some Conservative Members today: when it comes to the crunch, the shareholder and profit-maker must take precedence over the passenger and the need to run the system. That is not in anyone's interests. I hope that it will not be the case when the time comes for a renegotiation.

Will the hon. Lady give way?

No. I am coming to the end of my speech and many hon. Members are waiting to speak.

I welcome the opportunity that the Secretary of State has given my Committee to look closely at the Bill. It is long overdue. It has tremendous opportunities for every one of us. It is the first time for many years that any senior Minister has come to the House with a plan for the future that is optimistic. My right hon. Friend's plans relate to the future, not the past—whatever that murky and unhappy place may be. I assure my right hon. Friend that we shall play our part in the passing of the legislation, and the securing of the examination, on time. I trust, however, that he will not expect us to work at quite the same pace for the rest of the current Parliament; if he does, we may have the odd thing to say.

I am glad that at long last—more than two years after the general election—some transport legislation is before the House. I have repeatedly offered the Secretary of State our support for the passage of the Bill at the earliest possible opportunity, and I am disappointed that it will clearly not be enacted until some way into the next Session. The travelling public will be disappointed as well: they have not seen the improvements that they may have expected following the change of Government. Those improvements are vital, and we will do what we can to ensure that the Bill is passed sooner rather than later. The Secretary of State's role has, I think, been to do all that he can internally, within the Government, to speed up the process.

How does the hon. Gentleman intend to give the Bill a fair wind, given that no member of his party serves on the Select Committee on the Environment, Transport and Regional Affairs which will consider it?

We have negotiated to enable the sole Liberal Democrat member of that Committee to work on its Transport Sub-Committee in this instance, for the very reason that the hon. Gentleman has given. I personally feel that, if Select Committees are to be split into two sections—as not only this Committee but at least one other has been—they should have enough Liberal Democrat members for our party to be involved in both parts of their work.