§ 6.59 a.m.
§ Mr. Michael Marshall (Arundel)
On the Vote on Acount, Civil Supply Estimates, Class VI, Vote 2, I seek to draw the attention of the House to the plight of the rail commuter in West Sussex. In raising this subject I immediately declare an interest as one of the vice-presidents of the Mid-Susesx Rail Users Association.
I am glad to have the support at this early hour of the morning of my hon. Friend the Member for Chichester (Mr. Nelson), who is also a vice-president of the Mid-Sussex Rail Users Association, and I am authorised to say that my hon. Friends the Members for Horsham and Crawley (Mr. Hordern) and for Shoreham (Mr. Luce), who are also vice-presidents, wish to be associated with my remarks.
§ Mr. Geoffrey Johnson Smith (East Grinstead)
I do not have the honour to be a vice-president of the Mid-Sussex Rail Users Association. However, as part of my constituency is in West Sussex, I shall be delighted to be associated with my hon. Friend's remarks.
§ Mr. Marshall
It is very heartening to have my hon. Friend the Member for East Grinstead, who takes a keen interest in many matters affecting our county, with us at this early hour. Indeed, he has been here for some hours past discharging his onerous task of trying to keep the country's policy on the right lines.
I welcome also the Minister who is on duty to answer the debate and who had the courtesy to write to me on 14th December. I shall be referring to his letter extensively as part of what I take to be the Government's policy on the whole question of commuters' problems, but the policy is obviously not confined to our county.
340 I seek to draw the attention of the House to the problem, but not just from a constituency point of view. Much of the thinking that my hon. Friend and I have devoted to the matter has been greatly facilitated by the representations made to us by the Mid-Sussex Rail Users Association. The Association is a very active body which co-ordinates closely with British Railways, Southern Region, and in general it does a first-class job of trying to ensure that the arguments are fairly and fully explored.
I emphasise that in referring to the Mid-Sussex line which links the Sussex coast with London I am also seeking to consider the problem of the commuter within the county generally. That involves the various services along the coast and the whole infra-structure of Southern Region. If I concentrate on the problems on the Mid-Sussex line. it is because the coast to London line is the area with the most commuter traffic. Very detailed points about the service on this line have been made by the Mid-Sussex Rail Users Association.
The present feeling of anger on the part of commuters stems from the fact that over successive years—I accept that this is not confined to one Government, although I shall seek to show that the present Government bear a special responsibility—the policy of encouraging people to move away from large urban centres to areas of cheaper housing carried with it the supposition that some form of relatively cheap transport would be available for commuters through the season ticket system.
Many people have tended to move into my constituency a few years ahead of their retirement, with the intention of commuting to work over the last few years of their active working life and then settling down to retirement in our part of the world. This section of the community is hit particularly badly. We are in a period of high inflation and an effective wage freeze. Yet costs have risen sharply all round. Food prices have risen particularly sharply.
I will quote some figures to show how fares have increased over the last few years. Second-class season ticket rates for all stations between Bognor Regis and Horsham to London have more than doubled since September 1972. The cost of a second-class season ticket 341 between Arundel and London has risen risen by 120 per cent., the cost of one between Arundel and London has risen by 110 per cent., and the cost of one between Horsham and London has risen by about 110 per cent.
When we get down to the figures, we are talking about a season ticket which has gone up from £235 in the case of Bognor Regis in 1972 to £493 in 1976. These figures, with the anticipated increases from 1st January of approximately a further 11 per cent. for the Bognor and Billingshurst area, and 16 per cent. for the Horsham and Christ's Hospital area, mean that we are seeing not only a doubling of the figures that I am quoting, which apply right across the board, but an impost in terms of rail travel of about £10 a week.
The Minister will appreciate that for the average salary earner to find out of net income £10 a week purely to get to his place of work is becoming a burden of a very high order indeed.
This has been particularly aggravated since January 1975, because in the case of Bognor Regis certainly the increase has been 60 per cent., and this clearly reflects, in the minds of the Mid-Sussex Rail-Users' Association, its assessment of the present Government's policy of discriminating actively against the rail commuter.
Looking at the Government's Transport Policy document and combining that with the recent pronouncement of the new Chairman of British Rail, as well as the recent statements of the Secretary of State for Transport, I do not think anyone can be particularly sanguine about future prospects. All these various experts suggest that rail fares are likely to continue to rise in real terms at the expense of rail traffic so that the present rail subsidy can be minimised. Likewise, it seems that investment levels are to be pegged, which can lead only to a deterioration in the services. Therefore the basic worry that has been put to us is that in the short term fares will continue to rise fairly rapidly, and that in the long term, as the result of traffic losses, there will be the possibility of further cuts in the services or total withdrawal of certain services.
342 Taking the Mid-Sussex line for the moment, in British Rail subsidy terms that line now has a loss of about £900,000 per annum, yet we must assume, because of the density of the traffic and the nature of the area, that that service was profitable in the recent past. Therefore we must argue that the trend towards non-profitability has been caused by inflation and the loss of traffic because of rapidly rising fares.
It is in that context that I must put it to the Minister that the Government bear special responsibility, because they are a Government who have brought in an era of high inflation, varying between 15 and 28 per cent. through their whole period in office. They have a special responsibility for answering the kind of passionate conviction felt by the commuters that they are being singled out in this matter.
It is common ground that, in discussing these matters in the past, Members on all sides have drawn on the comments made by the previous Chairman of British Rail, Sir Richard Marsh, who made it absolutely clear that in his time in British Rail the commuter was being singled out because it was felt that he could bear the extra burden, being captive trade.
Although there are now disclaimers coming from British Rail, the House will want to hear from the Government how far they can substantiate any argument which goes against that, because, coming from such an authoritative source, that squares very closely with the instincts and the passionate feelings of commuters up and down the country.
If we look particularly at what the Government have been saying recently, we should perhaps refer to three sources. On 12th November there was an Adjournment debate in which my hon. Friend the Member for Harrow, East (Mr. Dykes) raised the problems of London commuters. That debate, which we do not need to rehash in full today, inevitably covered a certain amount of common ground. I have also the evidence of a letter from the Chairman of British Rail, dated 18th November. Finally, I have a letter from the Under-Secretary of State, dated 14th December, for which I thanked him earlier but to which I shall want to return.
343 All these sources of information, on which the Committee can draw to assess what is the Government's true intent and thinking about the problem of the commuter, seem to me to bring out three common features. The first common feature which must be evident to all is the frustration which commuters and all representative bodies feel in trying to pinpoint the true cost-and-earnings situation in respect of that part of British Rail's services which they use. This frustration is made all the stronger because of lack of any clarification about the relationship between British Rail's commuter and freight services.
The immediate suspicion goes back to the comment of Sir Richard Marsh about the commuter being made to carry the burden. This was brought home sharply in the debate in this House on 12th November, when my hon. Friend the Member for Sutton Coldfield (Mr. Fowler) said:A subsidy of £66 million a year is going to British Rail freight operations. A subsidy of £31 million a year is going to the National Freight Corporation."—[Official Report, 12th November 1976; Vol. 919, c. 892.]Here is a whole area where the Government must have a view. On what possible grounds can freight traffic be treated any differently from commuter traffic? Freight should pay its way on a straightforward commercial basis and should not receive a subsidy. If the Government put this argument forward in the case of commuters, they must apply it also to freight.
On 12th November the Government had no answer. I hope that the Under-Secretary will address his mind to this issue now. The fears I have expressed have been added to by a letter I received from the Chairman of British Rail, Mr. Peter Parker, in which he says:The new fares will be applied on a selective basis equivalent to a 12½ per cent. average increase overall, which is in line with the latest position known to the Board of the rate of inflation and, when allied to the various measures that the Board has taken to reduce the working costs, are essential to meet the Board's obligation, recently confirmed by the Government to maintain constant the taxpayer's financial contribution to the railway passenger network.The words on which commuters will seize are "selective basis". What selective basis? This is precisely the way 344 in which uncertainty occurs, and a clear-cut assurance is required from the Government.
Recent debates and correspondence have revealed the Government's refusal to show any particular interest in possible variations of the fare structure. They must have some views on the apparent illogicality and seeming unfairness of policies of lower fares for day trippers and holidaymakers, as opposed to commuters. The commuter is the backbone of British Rail traffic. He provides the vast bulk of revenue of British Rail and passenger traffic, and it seems to many that the idea of fiddling around with penny package deals of an Away-Day scheme—desirable as that may be when British Rail is running effectively—brings out the effective discrimination in favour of those who do not contribute anything like the turnover of the commuter to British Rail.
Then there is the suggestion, put forward by the National Union of Railwaymen, of a 10 per cent. reduction in the cost of season tickets. The Government attitude was summarised in a letter from the Under-Secretary of State in which he said:We would not wish to intervene if British Rail decide to experiment, but they would have to cover the cost if the experiment did not succeed.With all respect to the Minister, that is not a very encouraging voice. It is hardly a clarion call from the Government to British Rail to pull out the stops and try something adventurous. The Government do not wish to intervene and if British Rail do not get it right, it must foot the bill. It seems to me as if a passing the buck attitude is coming through at a time when commuter anguish is growing.
The Government should have some thoughts on the matter. I stress the approach taken by the NUR because many hon. Members will feel that it is a good sign to see the unions coming forward with a solution that they believe will help increase revenue.
I am not satisfied that the matter has been examined thoroughly. The Minister made general estimates about the likely effect on traffic. This is an ideal opportunity for him to say to British Rail and the NUR that if they seriously want the scheme they should get together and tie it in with productivity talks.
345 The Government have been most shy over productivity and manning levels. They have failed to impose a standard of judgment on what is going on, and that makes me worreid about what is happening in the Department. The Minister's final paragraph in the 14th December letter reads:Finally, turning to your own point about manning levels and the operating efficiency on the railways, I think this is in an area in which the Railways Board is best able to judge what improvements are possible and, in consultation with the unions, take appropriate action.I regard that as passing the buck. What is to be the yardstick by which British Rail's success is judged? If we are told that over a long period it is gradually to get British Rail back into the black, that is one standard. But surely the Government must have some thoughts about whether the numbers are meaningful.
Does the Minister accept the projected reduction in staff levels of 40,000 by 1981? Is that figure likely to bring with it opportunities for fare reductions? Can he hold out some faint hope to the hard-pressed commuters that if they stick with British Rail they will see some light at the end of the railway tunnel? The Government have a responsibility to make clear whether they are seeking to bring in constructive policies. I do not preach interventionism in the nationalised industries, but the Minister is responsible for laying down broad principles.
The Government's approach to the subject recently has been wishy-washy. The Minister comes with freshness and vigour to his post, perhaps illustrating some of the Government's problems because they took so long to pick out his talent. He must be prepared to give some Christmas cheer to the commuter.
Commuters feel that they are being made political scape goats and that they are among the front line troops being sent over the top to be mown down in the gunfire of the Government's own crossfire.
§ 7.19 a.m.
§ Mr. Anthony Nelson (Chichester)
I congratulate my hon. Friend the Member for Arundel (Mr. Marshall) on raising this important matter, which effects many of my constituents. I share some of the responsibility as vice-president of the Mid-Sussex Rail-Users Association— 346 an organisation which is representative of a large number of my constituents and which reflects, both in its formation and in its activities, the real problems and fears which are shared by many residents in both our districts.
I know that these are problems which as my hon. Friend has said, are shared by our hon. Friends the Members for Horsham and Crawley (Mr. Hordern) and Shoreham (Mr. Luce), in whose constituencies there are major commuting stations to London. Pulborough station, in the Shoreham constituency, carries a substantial number of constituents from the rural area in the middle and east of my constituency, but also a number of my constituents travel to and from London from stations just outside the constituency, outside the border of West Sussex, from both Haslemere and Rowlands Castle and some other stations on the London to Portsmouth Line.
I should like to pick up a point made by my hon. Friend. There is a substantial and a growing number of people who are commuting both within Sussex itself and along the South Coast line. Many of my constituents have expressed fears and made representations to me, as the Minister may know, about the future of the South Coast line, particularly from Chichester going west to Havant and beyond, and going east to Bognor Regis and Brighton. This line is used substantially, certainly during the peak hours.
Many of my constituents have expressed fears about the substantial increase in fares which they have to pay on these lines. They feel that they are being unfairly treated in having, perhaps, to cross-subsidise some of the massive costs of the main commuter services up to London. They are also concerned about the future existence of some of these services in terms of whether the network will continue, or indeed, if it continues, whether there will be a sufficient frequency of services along the South Coast line to satisfy their needs.
Many of my constituents who have had to suffer a decline in the service provided by British Rail and to bear substantial increases in costs feel justifiably aggrieved. Many are in a similar category to those mentioned by my hon. Friend the Member for Arundel, being 347 fairly elderly people who are approaching retirement and who therefore find it extremely difficult, on perhaps rather more fixed means than many younger commuters, to make ends meet. It is these personal difficulties of many of my constituents that I want to impress upon the Minister.
Many of my constituents who are commuters are at the end of their tether. They are approaching the end of their finances. It has been extremely difficult to make ends meet for many elderly families over recent years. The increases in fares from Chichester and Haslemere, two of the main commuting stations for residents of my district. have been over 100 per cent. over the last few years. They are simply not able to bear such an increase without taking a major reduction in their standards of living.
I understand that such cuts in living standards have been a necessity of the present Government's economic policy, as they would be the policies of any Government, of whatever political colour, at present. Nevertheless, these people are being called upon to bear a very substantial financial burden. This increase in costs will make life very difficult for them, especially in meeting other commitments. such as mortgage repayments, their family's health and the cost of their feeding over the next year. For many families it is a matter of desperation that the latest substantial increases in costs have taken place.
They feel victimised, frustrated and bewildered that they were encouraged in years gone by to settle in those areas and have undertaken substantial personal commitments and liabilities, but inexorably they seem to be being pushed into further and higher contributions, by means of fares, to British Rail. The situation seems to be spiralling out of control, and they have no influence over it.
It is on behalf of these people that I make this plea for the Government to express at least some sympathy and some more finite plan and means of dealing with the situation and providing assurances that it will not be allowed to get out of control.
I understand that the Chairman of British Rail and the administration of 348 that nationalised industry have been operating within the constraints of policy defined by successive Governments. Indeed, when the new Chairman of British Rail wrote to me in response to some representations that I made to him he was not slow to point out that part of the reason for the substantial increase in fares over the past few years was the degree to which prices were kept down under the counter-inflation policy of the Conservative Government. I do not believe that it is sufficient to lean on Government policy as a means of defending some of the substantial increases in fares that have been necessary recently.
I recognise, too, that the Government's social contract has some influence in this, to the extent that British Rail feel unable to take the necessary incisive action about overmanning and employment levels throughout the system because they might be persuaded to believe that that was unacceptable in terms of the social contract. Thus, in a sense British Rail are continuing to operate within the constraints of Government policy and it is my constituents who are having to pay the real price, because these inequities and inefficiencies are continuing. Overmanning has to be paid for. and there has to be a substantial subvention to cover the deficit.
I understand that in recent years the figure has been running at £300 million, and this sum has been borne not only by the taxpayer but by those who have to travel. They are hit twice. Not only do they have to pay their fares, but they have to make a substantial contribution to the deficit by way of their taxes. I should like the Minister to provide some reassurance that further economies will be undertaken by British Rail to ensure that further substantial increases in fares will not be necessary, nor will there be a need for a substantial increase in the subvention from public funds to cover their deficit.
We should like to know what progress is being made on the financial returns that British Rail get from off-peak travel, excursions and away-day fares to which the new Chairman pointed as a major means of cutting down some of the cost or maximising the use of some of the expensive facilities that are necessary for peak travel.
349 We should like to know, too, how the problem of overmanning, which undoubtedly exists, is to be dealt with by British Rail, and what encouragement the Minister is giving them to take an incisive attitude in dealing with this problem. There are difficult problems from British Rail's point of view, but there is far greater concern amongst rail users who, in the last resort, have to pay the price of inefficiency.
I believe that there is a need for greater understanding amongst rail users of both the Government's and British Rail's policy. There is a need for more explanation and reassurance. Rail travellers have been left out in the cold. They feel frustrated and victimised, and unless a few of them are able occasionally to write to their Members of Parliament and he is able to publicise some of the problems facing British Rail and explain the reasons for some of the increases in fares and chances of service, they do not know what is going on. I expect that the representations that I receive are but the tip of the iceberg.
The problem is real and personal for many families. The increase in fares has to be paid out of net income. The fares have risen substantially more than the rate of inflation, and certainly substantially more than people's net incomes. This is a desperate situation for many rail users in West Sussex, and we look to the Under-Secretary of State to provide us with some reassurance and real answers to this difficult problem.
§ 7.30 a.m.
§ The Under-Secretary of State for Transport (Mr. John Horam)
I am sure that the commuters of mid and West Sussex will be grateful to the hon. Members for Arundel (Mr. Marshall) and Chichester (Mr. Nelson) for raising this matter, and I thank both hon. Members for the responsible way in which they have approached it. I have learnt not only from the debate but from the comments in the newspapers that the activities of the mid-Sussex Rail Users' Association, of which both hon. Members are, I believe, vice-presidents, reflect the concern in that part of the country.
I can well understand the use by the hon. Member for Chichester of such words as "desperation", "victimised" and "bewildered" about the attitude of 350 commuters faced with these enormous increases. The figures are startling. Since 1974, fares have increased by about 90 per cent. on a cumulative basis, and if one adds the 12½ per cent. expected in January, there is a considerable cumulative total for anyone to have to face in about two and half years. That is a much faster growth than the general rate of inflation.
I think that the hon. Gentlemen will accept that, with a labour-intensive service of this kind, there are special problems in a time of inflation in the sense that its costs are bound to increase faster than those of manufacturing industry. It cannot make the kind of rapid gains in productivity and other such measures when coping with fast increasing wages that manufacturing industry can make. All public transport is struggling against the erosion of its market by the increase in car usage which is going on despite the economic situation. There is also the peaking factor twice a day, which adds to the difficulty of keeping down fares as we would like.
Even so, despite the enormous increase in fares, the amount taken at the ticket office is still not meeting the total costs of the services provided. The present public subsidy to the railways is running at an historically unique level—about £300 million. The share of London and the South-East commuter services is about £80 million, so they are not discriminated against in the proportion they receive of public funds aimed at keeping down fares.
Despite the huge increase in fares, a substantial subsidy is still protecting commuters of mid and West Sussex against the full impact of the economic situation. The Government are committed to carrying on with fare subsidies, or total passenger subsidy, although the latest round of cuts means that a small amount is being taken off passenger subvention. But in total we look to a freezing of the amount of passenger subsidy over the next few years, and therefore, within the total transport budget, given that we are having to cut back severely on the roads programme and works—which has also affected mid and West Sussex—rail subsidies are a rising proportion of the total
§ Mr. Michael Marshall
Would the hon. Gentleman care to cover the part of the subsidy in respect of freight services?
§ Mr. Horam
Yes, I will come on to that. I wanted to deal with some general points first. The hon. Member made something of a party point when he said that this Government had a special responsibility for the sharp increase in fares. I cannot accept that. The hon. Member for Chichester said that fares had been held down under the counter-inflation policy of the Conservative Government. That was probably sensible then but there are enormous difficulties when one has to adopt realistic pricing policies for all nationalised industries. The catching-up process is difficult. That is a clasic argument against an incomes policy and it is unfair to place any special responsibility on any Government for trying to meet the inflationary problems of our time, which are part of a wider picture.
The hon. Member talked about commuters wanting to know the true cost of their services, as opposed to the true cost of freight carrying and so on. He talked about the £66 million subsidy to British Rail and said that the Government must have a view. Indeed they have, and they have stated it frequently. We want the freight subsidy phased out, since it was the policy under the 1974 Act, to which his party contributed, that there should be none. There have been difficulties caused by the economic recession and the decline in the steel and coal trade. Therefore, we have had to help out for a period, but the subsidy is being reduced and will be sharply eliminated. We cannot justify it on social grounds.
The hon. Member slipped into saying that freight should pay its true costs. By the same logic, presumably passengers should pay their true costs, too. But then they would have to find the £80 million to the tune of which London and South-East commuters are being subsidised, and he would not want that. So when freight is no longer subsidised, the commuters of West Sussex will continue to be subsidised. There can be no alternative at present.
The hon. Member said that the Government had shown no interest in fare structures but added that the Secretary of State had given his blessing to experiments with different fare structures particularly to an experiment in cutting fares to 352 see whether there is any substance in the NUR's view that extra traffic could be attracted. He chastised the Government, however, for saying that there would be no subsidy to cover any resultant loss. I have given the hon. Gentleman credit for a responsible attitude. Equally, we cannot responsibly sign a blank cheque for such experiments. This is a matter for the commercial judgment of British Rail in conjunction with the trade unions who will want to be included in the information and marketing exercises which are involved.
§ Mr. Michael Marshall
The Minister is missing the thrust of my argument. I said that the suggestion of the NUR for a 10 per cent. deduction in the price of season tickets provided the Government with a golden opportunity to get the sides together to consider productivity, bargaining and so on and to have a more meaningful dialogue. The Minister said that this was a matter for British Rail and that the Government would not intervene.
§ Mr. Horam
I entirely accept what the hon. Gentleman has said. Of course we are bound to sound rather wishy-washy because we are in the middle of consultations. We have completed the formal consultations with everyone who has a logical and viable interest in transport.
The hon. Member for Chichester spoke about a finite view. I accept that we must arrive at a clear view on how to tackle these problems and square the difficult circles in transport policy. We are arriving at a view, but I cannot reveal it at this hour in this debate. We are in this process of arriving at clear-cut decisions and I hope that the House will be happy when we bring them down-not like tablets of stone from the mountains, but after further, more informal contacts with the interests involved. There are many conflicting and entrenched positions in transport policy and we must get people talking to each other about problems in a way in which they have not done before.
We have tried not to rush in foolishly since the Department was set up but to take our time. Inevitably this means that for a while we must sound negative and wishy-washy. However, clear-cut, positive action is going on though I hope that hon. Members will understand why I cannot say more about that.
353 I accept that the consultation and drawing together of the threads must include consideration of flexible marketing policies, fares, manning and productivity. One of British Rail's responses to the consultation document has been to suggest 15 methods of cost cutting which it intends to pursue with the unions. We are encouraging British Rail to continue with the consultations and to look creatively at the problems.
It is too easy to stand back and tell commuters that they must be realistic and face facts. Even if it is difficult, we must seek a creative way forward and give people an understanding of the sort of problems we face, including, for example, the constraints on public expenditure. We should not be entirely gloomy. I have figures which show that despite the increases of the past two and a half years, commuters on the lines referred to by hon. Members still get very good value for money. It is about 2p per mile. The monthly season ticket for commuting from that part of the country to London compares reasonably favourably with driving costs. Going by rail is also faster and more comfortable.
§ Mr. Michael Marshall
I want to pick up the hon. Member in his use of the figure of 3p per mile for cars. He is on a dangerous line of argument. Half my constituents are hiring and driving cars for groups of commuters. That makes a hole in the Minister's argument. That is what he must watch out for. People are beginning to move from rail to road.
§ Mr. Horam
If it was a dangerous argument I should not have used it. But the rail fare is not quite such a bad bargain, even though I accept that it may encourage car pooling and various schemes of that kind, whereby people can drive more cheaply.
For the longer distances, by comparison with the shorter, in fare per mile, taking the example of the British Rail monthly season ticket, whereas a person who is commuting a distance of five miles pays a fare of 3.80p per mile, the person commuting a distance of 30 miles pays only 2.73p per mile, and for 60 miles—the sort a distance that the hon. Member is talking about the cost is down to 1.84p per mile, in terms of the actual cost of the journey.
354 Hon. Members are righly complaining. I am not saying that they are not. They are complaining with justice. The fact is that, relatively speaking, they have not a bad deal by comparison with the commuter over a shorter distance. I do not want to encourage them to make speeches about the shorter-distance commuter, but they might bear that fact in mind.
It is our job—although we cannot reveal our conclusions today—to take on board the points made by hon. Members. We ask them to understand that we are sympathetic and are trying to be as creative as possible in getting a good economic solution, which, fundamentally, means running things in the least expensive way consistent with a sensible service.
We want hon. Members also to be realistic about the sort of time scale in which we can achieve progress. I accept that the fare increases in the last two and a half years have made enormous inroads into people's incomes, but there are other problems in transport which are also our concern.
I hope that I have generally answered the points raised by hon. Members. We have not heard the last of this. I am sure that commuters in Sussex should be grateful to all the effort that hon. Members have put into making their points this morning.