Lord Moylan (Con)

My Lords, I have a number of amendments in this group: Amendments 55, 56, 70, 78 and 86. I start with Amendment 78. Paragraph 15 of Schedule 2 states: “Financial assistance given to Great British Railways or a GBR company” primarily to enable it to carry out its infrastructure functions under Clause 3(1)(a)—this is one of the general functions that we discussed on Tuesday—is not to be treated as “a subsidy for the purposes of the Subsidy Control Act 2022”. This is a probing amendment to find out the justification for that. I suspect that the justification is that it is not treated as a subsidy currently and, therefore, the Bill simply carries forward the existing situation. I wonder whether that is appropriate. The Subsidy Control Act 2022 exists for a purpose and requires that public authorities should consider whether subsidies are proportionate and necessary, whether they distort competition or investment, and whether their benefits outweigh their adverse effects. I wonder why the management, renewal and operation of infrastructure on railways should be specifically exempt from those requirements. This exemption does not apply to the other general functions listed in Clause 3, but it applies to this one. I do not want to be hypercritical, because I know that these things are very difficult and there are often excuses, but why should this condition not apply to these functions—particularly when there is a general lack of confidence in these functions being carried out with great efficiency at the moment and when they always seem to be very expensive? Is there a reason other than simple inertia? I do not think that inertia is enough. The Act also requires safeguards on transparency, the scrutiny of particularly significant subsidies by the Competition and Markets Authority, and ultimately the ability to challenge subsidies decisions via the Competition Appeal Tribunal. Noble Lords may say, “All of this is going to happen. It’ll be GBR doing stuff for GBR rail, so how does competition come into this?” But, as noble Lords know, a great deal of maintenance activity on the track is carried out by private companies contracted for that purpose; that may upset the noble Baroness, Lady Jones, but there we are. As far as I know, there is no indication in the Bill that that will change, and so I understand why the provision of subsidies might raise competition concerns. There is an appropriate authority here that can address them. That is my first question. It is a probing amendment, but I would like to know why these potentially very substantial sums should be outside the regular framework. In Amendment 70 I am simply asking for the business plan to be published. I think it is important that people should be able to see it. It is possible the Minister will say that he has every intention of publishing the business plan; TfL publishes its business plan, and most other similar organisations publish their business plans. As far as I can see, there is no statutory obligation in the Bill—I may have missed it—to publish the business plan each year or period to which a new business plan would apply. Amendments 55, 56 and 86 are about building financial discipline, both in the Government and elsewhere. Here, perhaps, I contest the comments made by my noble friend Lord Harper and will say something about the amendments tabled by the noble Lord, Lord Bradshaw. There is a serious issue here and I do not think that the noble Lord has got it right. I do not actually think that my amendments have got it right, but this is the right place for us to talk about the general question of how the Government treat the railways in terms of funding and the provision of funds—not how much they give, but how they do it and what the process is. The reason for that is as follows. I used to be in a local authority and very often we had to set a budget in March but did not know until Christmas—even after Christmas—what the subsidy from government would be. It is extremely difficult to put budgets together at short notice. With the railways, it is even more difficult. The noble Lord, Lord Bradshaw, has already said that significant changes require a great lead-time and planning to be delivered and just as long for them to be reversed. Most of my amendments are trying not to fetter Ministers—I accept the comments from my noble friend Lord Harper that Ministers have to be accountable for public expenditure and that they have to make difficult decisions sometimes—but to build in a notice period. I have suggested two years so that, if changes are to be made, they would be lagged by that period, so that Great British Railways knew where they were going to be. When the noble Lord, Lord Bradshaw, talked about timetables and so forth, he was discussing the operational side of the railway, but there is also the infrastructure investment side of the railway, which may extend to building a completely new railway. One of the problems we have—we all acknowledge this—is that it is impossible to build new infrastructure on a one-year settlement. We give long-term settlements to railway developers so that they know that they will have the money to carry the project through to the end. Should that change in funding not also be subject, if it is necessary, to some sort of notice period? Further down the line from that, we have the supply chain. A colleague of mine recently visited a British train manufacturer. I will not say which one because I cannot remember. Maybe I can, but what I was going to say might be adverse—not about the manufacturer but about its situation—because it is down to using one manufacturing line at the moment, as the orders have effectively dried up. We all know that the ideal situation is that British train manufacturers have access to a steady supply and a steady stream of demand, so that they maintain jobs and do not go from famine to feast. Where is the discipline going to come from, as a result of all these changes, to address that? What sort of lags and notice are necessary? As I said, I do not think I necessarily have the answer in these amendments, although they all point to this debate. We may not get further on this today, but the Government will have to talk seriously about this. When they create a wholly new structure to operate the railways—Great British Railways—funding has to be mentioned. An understanding of the approach to funding, not just for the operations but for the infrastructure, has to be addressed.